Porsche rejects VW stake bid

• Source: Shanghai Daily
• [09:28 June 30 2009]
• Comments

Porsche has rejected Volkswagen AG's bid to take a 49 percent stake in the sports car maker, a company spokesman said yesterday.

Porsche Automobil Holding SE spokesman Albrecht Bamler said the offer by VW "is not a viable option."

According to Bamler, Porsche board chairman Wolfgang Porsche received the offer in a letter by courier last week. But the company's CEO Wendelin Wiedeking and management board were not informed. "Without the management board, nothing goes here," Bamler said.

Porsche holds a roughly 51 percent stake in VW, but ran up hefty debts in accumulating that holding and is now seeking a merger with the larger company. Exactly how that is to happen remains unclear.

German weekly Der Spiegel reported the VW offer was worth 3 billion euros to 4 billion euros, which would have helped Porsche pay off it sdebts, racked up in its attempt to take over VW.

Bamler said, however, that for VW to take a stake in Porsche, the Wolfsburg-based auto maker would have to take out credit worth 10.75 billion euros (US$15.15 billion).

Porsche, based in Stuttgart, confirmed earlier this month it has been holding discussions with a Qatar state investment fund, the Qatar Investment Authority, on a possible investment.

VW shares dropped 10.6 percent on the news to 237.91 euros in afternoon trading in Frankfurt yesterday.

Porsche shares nudged up nearly half a percent to 45.92 euros in Frankfurt.