Frankfurt - German sports car maker
Porsche is set to increase its 31% voting stake in
Volkswagen to a majority but does not intend to merge the two
carmakers, it said on Monday.
At an extraordinary meeting on Monday, Porsche's supervisory
body authorised the long-awaited move, which the maker of 911
sports cars and Cayenne offroaders said would represent an
investment of almost 10 billion euros ($15.17 billion).
"Our aim is to create one of the strongest and most
innovative automobile alliances in the world, which is able to
measure up to the increased international competition," Porsche
chief executive Wendelin Wiedeking said.
Lifting its stake above 50% would not require Porsche
to make a full bid for VW because it made an offer at the legal
minimum price last year which few investors took up.
The German state of Lower Saxony, VW's second-biggest
shareholder with around 20% of the votes in Europe's
biggest automaker, reiterated it would keep its stake and
continue to play an active role as Porsche's partner.
Porsche, controlled by the family of VW Chairman Ferdinand
Piech, has long been expected to gain majority control of VW
after Europe's highest court last year struck down a German law
that capped individual shareholders' voting rights in VW.
Wiedeking said in September that Porsche had acquired enough
options to raise its VW stake "significantly" but has not
specified whether they would suffice to gain majority control.
It has argued it needs to preserve strong influence at VW -
which provides content for a third of the vehicles Porsche sells
- to ensure VW does not fall into the hands of unfriendly
investors such as hedge finds or private equity houses.
Porsche began building its VW stake in 2005.
In the wake of last year's ruling, the German government is
debating a new VW law whose draft version preserves a strong say
for VW staff and Lower Saxony, something Porsche is fighting.
Shares in Porsche rose as much as 6% and were up 3.2% at 117.20 euros by 1607 GMT while Volkswagen stock rose
1.5 percent to 152.19 euros.
Porsche said in a statement it had instructed management to
start all steps needed to gain regulatory and antitrust approval
for the move.
"The reviews by the regulatory authorities are expected to
take several months. As soon as the requisite clearances have
been obtained, Porsche SE can acquire the majority of the shares
in Volkswagen," it said.
"Porsche has positioned its chess pieces in such a way that
nothing might happen. They don't need to be in a hurry," said
Mirko Pillep, a share market strategist at German bank Helaba.
Juergen Pieper, an analyst at Bankhaus Metzler, said the
likelihood of Porsche winning majority control at VW had risen
but noted that Porsche still had a free hand after what amounted
to a formal step by the supervisory board.
"Everything is still possible. It is also possible that they
leave the stake where it is," he said.
VW, which earlier said it was gaining majority control of
Swedish truckmaker Scania, was not immediately available for