Porsche AG will hold a supervisory board meeting today as the controlling shareholders, the Porsche and Piech families, to try to agree on the details of a combination between the sports-car maker and Volkswagen AG.
The supervisory board of Porsche will meet in Weissach, Germany, Porsche spokesman Albrecht Bamler said by telephone on Saturday. He declined to comment on the content of the meeting. Porsche AG is the operating unit of the luxury carmaker owned by holding company Porsche SE.
The Piech and Porsche families, who control the Stuttgart, Germany-based maker of the 911 sports car, agreed on May 6 to create a combined company with Volkswagen, ending a three-and-a-half-year bid to increase control of Europe’s biggest carmaker by acquiring additional Volkswagen shares. Volkswagen Supervisory Board Chairman Ferdinand Piech said last week that Porsche SE must trim debt before it can complete a merger with Volkswagen.
Volkswagen “won’t solve” Porsche’s net debt, which tripled in six months to 9 billion euros (US$12.2 billion) as of Jan. 31, Piech said. Porsche owns about 51 percent of Wolfsburg, Germany-based Volkswagen, whose automotive division had 10.7 billion euros in net cash as of March 31.
Porsche Supervisory Board chairman Wolfgang Porsche was struggling to raise financing to increase the stake in Volkswagen to 75 percent and had been at loggerheads with Piech about how to unite the carmakers. The chairmen are cousins whose grandfather, Ferdinand Porsche, founded the sports-car manufacturer and designed Volkswagen’s first model. Piech is also a member of Porsche’s supervisory board.
The Porsche family is upset over Piech’s comments and concerned they may hurt the value of the carmaker, Der Spiegel said on its Web site on Saturday, without saying where it got the information. When asked about whether Volkswagen would pay the speculated price of 11 billion euros for Porsche AG, Piech said that amount was “definitely a few billion too high,” the German magazine said.
Porsche workers will hold their first-ever strike today to protest Piech’s plans for a takeover by Volkswagen, Focus reported on Saturday, without saying where it got the information.
Der Spiegel also said that Porsche and BMW have discussed the possibility of state loans as they navigate the global economic crisis that has taken a heavy toll on demand.
“The two companies have not yet made an official request,” the magazine reported in its edition due out today. “The financial director [of Porsche] Holger Haerter visited the headquarters of public bank KfW in Frankfurt ... to sound out the possibilities of Porsche obtaining state credit.”
The magazine reported the amount to be about 1 billion euros (US$1.4 billion).
BMW also made inquiries with KfW, the German government’s financing arm, last month, Der Spiegel said.
Porsche, which announced its merger with Volkswagen earlier this month, has seen its debt climb to some 10 billion euros.
BMW, meanwhile, has been hard hit by the economic crisis and cut more than 900 jobs in the first quarter.
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