While Volkswagen chief executive Martin Winterkorn praised cooperation with majority owner Porsche at the annual shareholders meeting today, media reports in Germany suggested VW was considering a takeover of Porsche.
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“Our integration has come a long way in the last few months and I am sure that we will be able to drive our partnership forward in 2009, a difficult year for the auto sector,” Winterkorn was quoted by Reuters as saying in remarks prepared for the AGM.
He said Porsche and VW together had the potential to become “the centre of power for the international automobile industry”.
Reuters said Porsche, controlled by the Porsche and Piech families, owns nearly 51% of Volkswagen’s voting shares and plans to raise its stake to 75% as early as this year should economic conditions allow.
But analysts have increasing questioned whether Porsche can afford this step given its EUR9bn (US$11.72bn) in net debt, prompting speculation that cash-rich VW could acquire Porsche’s sports car business to relieve the debt burden, the report added.
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By GlobalDataPorsche, whose European holding company would still own VW under such a deal, has described this scenario as “highly unrealistic”, according to Reuters.
Nonethlessless both Financial Times Deutschland (FTD) and Financial Times (FT) said VW directors were considering making a bid for Porsche which would relieve the highly-indebted parent company Porsche SE. Porsche made a takeover bid for VW, with sales 15 times more than its own, three and a half years ago.
“The tail would finally stop wagging the dog,” a source told the FT, according to news agency AFP.
The FTD said Porsche boss Wendelin Wiedeking was looking for ways to finance the original plan to buy VW and a capital increase had not been ruled out.
AFP noted that Porsche’s difficulty in financing the purchase of the much bigger VW had raised market speculation in recent weeks.
Manager magazine said Porsche was in talks with possible investors in the Middle East, AFP added.
