There’s probably no better example of how the best laid plans can go horribly wrong in an economic crisis than the attempt by Porsche to take over Europe’s largest car maker, Volkswagen AG.
It now seems more than likely that Volkswagen will, in fact, take over Porsche’s sports car business if reports by Reuters Newsagency are to be believed.
Reuters quotes reports in the German magazine Der Spiegel that the controlling families of Porsche Holdings SE will agree on Thursday to accept an offer by Volkswagen to buy its sports car business Porsche AG for roughly 8 billion euros (US$11.28 billion).
Germany’s leading weekly magazine wrote that the rival Porsche and Piech families, which own 100 per cent of Porsche SE votes, will approve the two-stage takeover at a supervisory board meeting on July 23.
Volkswagen would purchase a 49.9 percent stake in Porsche AG and at a later date acquire the rest, in a deal that would create an integrated automotive group with 10 brands under the leadership of the Wolfsburg-based carmaker.
The sale would help Porsche SE pay off most of its debt, which two sources told Reuters has ballooned to considerably more than 10 billion euros.
Der Spiegel also said embattled Porsche SE and Porsche AG CEO Wendelin Wiedeking, who lead the charge to take over VW, is negotiating over a severance package that could total more than 100 million euros.
In the meantime, Porsche production chief Michael Macht will replace him as head of Porsche AG, the magazine reported.
Last week, Mr Wiedeking rejected speculation he was about to leave the group.
Asked whether the two families have reached a decision for the July 23 board meeting, Porsche spokesman Anton Hunger said “we have not been informed of one,” adding that the Spiegel report was speculation that the company would not comment on.
Separately rival German weekly magazine Focus reported that Volkswagen’s powerful chairman and part owner of Porsche, Ferdinand Piech, plans to remove Mr Wiedeking on Thursday from the influential six-man steering committee on the VW supervisory board.
The vacancy could open up the opportunity for Mr Piech’s cousin and rival, Wolfgang Porsche, VW supervisory board member and Porsche SE chairman, to replace Mr Wiedeking in the committee as a representative of his side of the family.
The grandfather of Wolfgang Porsche and Ferdinand Piech was Ferdinand Porsche, designer of the VW Beetle and founder of Volkswagen.