Porsche wants VW control
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[09/07/2007] German luxury sports car maker Porsche wants to increase its 31% stake in car giant Volkswagen, but has no immediate plans to do so at present, Porsche chief executive Wendelin Wiedeking said in a newspaper interview Thursday.
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German luxury sports car maker Porsche wants to increase its 31% stake in car giant Volkswagen, but has no immediate plans to do so at present, Porsche chief executive Wendelin Wiedeking said in a newspaper interview Thursday.
"We hold 31% at present, but no further decisions have been taken yet," Wiedeking told the regional daily Stuttgarter Nachrichten.
"Of course there's a plan. We've secured the rights to additional shares via options. But there's nothing pressing us to move at the moment."
Porsche began building its stake in VW in 2005 and recent press reports have suggested it is set to increase its shareholding to more than 50%, possibly early next year.
But Wiedeking said his group was holding its fire for the time being.
"We're waiting for the European Court of Justice to rule on the so-called 'Volkswagen Law'. That'll be very important for us," the CEO said.
The VW Law prevents shareholders from owning more than 20% of the voting rights in the car maker regardless of the size of their financial holdings.
The law has kept effective control of the group in the hands of the German state of Lower Saxony, where VW is based and which also owns shares in the car maker.
"We feel discriminated against by this law," Wiedeking said. "And he said Porsche had clear intentions to raise its stake in VW."
"The bigger our stake the more we will be taken seriously," the Porsche boss said. "A strong shareholder has more influence than a weak shareholder."
Despite recent increases in the price of VW shares on the stock market, Porsche should be able to raise its stake without paying too much for the additional shares thanks to the already fixed price of the stock options it has obtained.
Early this year, Porsche lifted its stake in VW to over 30%.
Under German law that would normally oblige a shareholder to launch a public bid for all remaining shares.
Porsche did so, but offered only the legal minimum price so that VW shareholders would prefer to hold onto their stock.
Porsche is believed to want to control VW without having to take the car giant over completely.
"We hold 31% at present, but no further decisions have been taken yet," Wiedeking told the regional daily Stuttgarter Nachrichten.
"Of course there's a plan. We've secured the rights to additional shares via options. But there's nothing pressing us to move at the moment."
Porsche began building its stake in VW in 2005 and recent press reports have suggested it is set to increase its shareholding to more than 50%, possibly early next year.
But Wiedeking said his group was holding its fire for the time being.
"We're waiting for the European Court of Justice to rule on the so-called 'Volkswagen Law'. That'll be very important for us," the CEO said.
The VW Law prevents shareholders from owning more than 20% of the voting rights in the car maker regardless of the size of their financial holdings.
The law has kept effective control of the group in the hands of the German state of Lower Saxony, where VW is based and which also owns shares in the car maker.
"We feel discriminated against by this law," Wiedeking said. "And he said Porsche had clear intentions to raise its stake in VW."
"The bigger our stake the more we will be taken seriously," the Porsche boss said. "A strong shareholder has more influence than a weak shareholder."
Despite recent increases in the price of VW shares on the stock market, Porsche should be able to raise its stake without paying too much for the additional shares thanks to the already fixed price of the stock options it has obtained.
Early this year, Porsche lifted its stake in VW to over 30%.
Under German law that would normally oblige a shareholder to launch a public bid for all remaining shares.
Porsche did so, but offered only the legal minimum price so that VW shareholders would prefer to hold onto their stock.
Porsche is believed to want to control VW without having to take the car giant over completely.
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