VW drives Porsche
The deal, worth €4.46 billion ($A5.44 billion), will raise VW’s stake in the luxury sportscar-maker from 49.9 percent to 100 per cent and values Porsche at €3.88 billion.
The takeover marks an ironic conclusion to an extraordinary situation that started seven years ago, just before the global financial crisis, when Porsche attempted to take control of the much larger Volkswagen but racked up huge debts in the process.
Perhaps in reference to this, VW Group CFO Dieter Potsch this week underlined the importance of VW maintaining its strong credit rating and “sound financial and liquidity position”.
Full integration of Porsche’s “highly profitable” automotive business into VW is expected to take effect from August 1 and will help boost the Group’s consolidated profit.
Volkswagen AG chairman Martin Winterkorn described the deal as “good for Volkswagen, good for Porsche and good for Germany as an industrial location” and said it will “benefit our customers, our employees and our shareholders”.
“Combining their operating business will make Volkswagen and Porsche even stronger – both financially and strategically – going forward,” he said.
“We can now cooperate even more closely and jointly leverage new growth opportunities in the high-margin premium segment through targeted investments in pioneering products and technologies.”
Having recently acquired Ducati through luxury subsidiary Audi, the addition of Porsche to VW Group’s portfolio gives it the full spectrum of vehicle types from motorcycles to heavy trucks.
Mr Potsch said the accelerated integration of Porsche “will allow us to start implementing a joint strategy for Porsche’s automotive business more quickly, to realise key joint projects more rapidly and hence to leverage additional growth opportunities in attractive market segments”. “It will also enable Volkswagen AG and Porsche AG to concentrate fully on their operating business by making day-to-day cooperation much simpler.”