Porsche has confirmed it received a EUR700m (US$980m) loan from Volkswagen but insisted it was not struggling with debt issues.
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German media reports over the weekend said Porsche was facing bankruptcy because of the high cost of servicing its debt. The company said it was negotiating with a number of banks, including the Bank of Tokyo, and was also seeking help from the regional government of Baden-Wurttemberg,
Porsche debt tripled since it built its 51% stake in VW last summer and its has abandoned a previously announced plan to take 75% of the much larger carmaker and is instead seeking a merger.
German weekly magazine Der Spiegel reported that the EUR700m loan from VW was made to help prop up Porsche’s finances earlier this year and that Porsche’s owners had put up Porsche Holding as collateral.
Porsche Holding is an Austria-based automotive wholesale distribution firm owned by the Porsche and Piech families, who also control Porsche Automobil Holding SE.
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