by Michael SatterfieldVW Group is moving forward with its plan to acquire the other half of Porsche's after the planned merger with Porsche's holding company has been put on hold. You may recall that Porsche attempted to buy VW in 2008, and this latest hiccup stems from legal risks that are attached to that attempted purchase.
Matthias Müller, Porsche’s chief executive, told reporters at the Frankfurt motor show that he expected VW to pursue a back-up plan by exercising options as early as next year to acquire a further 51 percent of Porsche’s sports car business for €3.9bn. He said the combination would create at least €600m in potential synergies.
This news caused Porsche’s shares to fall on Monday amid fears that VW would indeed exercise the option taking control of Porsche Holding Company's chief asset. Volkswagen has said it is exploring other options in addition to a buyout, but those plans are yet to be reviled. VW's management declined to go into the specifics about the delays but stated that they were not "unexpected" according to Ferdinand Piech, VW’s chairman.
The event had a shadow cast over it with news of the tenuous state of VW's partnership with Suzuki. The Japanese carmaker has been pressuring VW to sell its almost 20 percent stake in the company, freeing Suzuki from a co-operation agreement that has been plagued with problems. Executives from Suzuki disliked VW's steamroller approach and the communication problems and cultural differences have stalled progress.
Martin Winterkorn, the CEO of VW simply stated that VW has no plans to end their partnership with Suzuki and that VW is seeking to work with its Japanese partner to resolve any hindrances to moving forward.
VW is enjoying record sales this year, thanks to strong demand in emerging markets across its large stable of brands that include Audi, Skoda, Lamborghini, Bentley, and Bugatti. VW Group sold roughly 5.4 million vehicles in the first eight months of this year, up 14 percent year to date. But the company goal to become the largest carmaker in the world, overtaking Toyota, has faced a series of setbacks. As regulatory clearance from the EU has frustrated several mergers and joint ventures with smaller manufacturers.
Source: Volkswagen
This news caused Porsche’s shares to fall on Monday amid fears that VW would indeed exercise the option taking control of Porsche Holding Company's chief asset. Volkswagen has said it is exploring other options in addition to a buyout, but those plans are yet to be reviled. VW's management declined to go into the specifics about the delays but stated that they were not "unexpected" according to Ferdinand Piech, VW’s chairman.
Martin Winterkorn, the CEO of VW simply stated that VW has no plans to end their partnership with Suzuki and that VW is seeking to work with its Japanese partner to resolve any hindrances to moving forward.
VW is enjoying record sales this year, thanks to strong demand in emerging markets across its large stable of brands that include Audi, Skoda, Lamborghini, Bentley, and Bugatti. VW Group sold roughly 5.4 million vehicles in the first eight months of this year, up 14 percent year to date. But the company goal to become the largest carmaker in the world, overtaking Toyota, has faced a series of setbacks. As regulatory clearance from the EU has frustrated several mergers and joint ventures with smaller manufacturers.
Source: Volkswagen
_websize.jpg)
