Monday, October 27, 2008
Porsche moves closer to full VW control
Porsche has announced that it has increased its stake in Volkswagen Group to nearly 75%, an amount which will allow the sportscar maker to gain full control of VW’s cash flow.
The German state of Lower Saxony still owns 20% of the company which, alongside Porsche’s increased holding, means that only around 5% of VW shares are still in ‘free float’.
Under German law, taking a 75% stake will allow Porsche to impose a ‘domination agreement’, allowing it to put Volkswagen’s assets and revenues onto its balance sheets. Porsche has stated that it intends to reach this figure next year.
Porsche said: “We made the announcement after it became clear the disclosure should give so called short sellers – meaning financial institutions which have betted or are still betting on a falling share price in Volkswagen – the opportunity to settle their relevant positions without rush and without facing major risks.”
DATED: 27.10.08
FEED: AM
