VW Merger With Porsche All But Final
August 17, 2009
The final leg in the convoluted journey Volkswagen AG and Porsche AG have undertaken in the past several years is nearing as VW, once the takeover target of miniscule Porsche, prepares to instead take a controlling interest in Porsche and merge the two companies.
VW reportedly plans to drum up nearly $6 billion to obtain a 42-percent portion of Porsche AG and all of the company's holding company, Porsche Automobil Holding SE. Meanwhile, there's an estimated $1 billion coming from Qatar Holding LLC that will give it 10 percent of Porsche and most of the options Porsche holds in VW stock. The deal is expected to be complete by the end of the year.
The complex arrangement would make the Qatar Emirate the third-largest VW shareholder, behind the Porsche and Piech families probable eventual stake of a reported 35 to 39 percent and the German state of Lower Saxony's approximate 21 percent. The companies had not elaborated, however, on exactly what Qatar Holding's VW stake might be.
As for Porsche itself, the sportscar maker will be "absorbed" into VW by 2011, a timeframe reportedly approved by VW's supervisory board. Volkswagen would hold its initial stake in Porsche of about 42 percent also to be acquired by the end of the year.
As a result of Porsche stacking up as much as $12 billion in debt to accrue its controlling interest in VW - a process that took place over the last several years and often caused outright feuding between the Porsche and Piech families - CEO Wendelin Wiedeking was ousted late last month as the seeming final confession that the debt Porsche incurred in the bid to control VW had finally hammered it into submission.
This past week, however, the two companies were not speaking of the destructive feud but rather dealt out the now-expected talk of the synergies the two companies plan to exploit. VW's chief financial officer told the Wall Street Journal Europe that VW and Porsche will save hundreds of millions annually in shared product-development costs, merged purchasing operations - and the synergy that likely will disturb Porsche aficionados, shared platforms.
Porsche's sportscars are built on Porsche-specific platforms, but its Cayenne cross-utility vehicle rides on a structure already shared with VW, while both the Cayenne and the all-new Panamera (which Porsche says does employ a unique platform) share their V8s with several VW Group brands, leading purists to worry deeper integration of Porsche into VW will further erode Porsche's future product-development independence. - Bill Visnic
Photos courtesy Porsche Cars North America Inc.
1. The 911 series, Porsche's hallmark, rides on a bespoke platform.
2. Porsche's all-new Panamera is based on the underpinnings of the Cayenne, a structure already developed and shared with Volkswagen.
Posted by Bill Visnic at 12:06 AM under Business , Companies , News | Comments (4) | digg this | Seed Newsvine
Bill don't you mean all-new Panamera sedan is based on the Bentley Continental GT, Flying Spur, Audi A8,S8 & Volkswagen Phaeton architecture
or are you saying that the Cayenne,Touareg & the Q7 are all based on the same architecture as the cars?
Posted by: seinfeld12 | August 17, 2009 at 6:13 AM
It was originally reported in various media that certain elements of the Panamera structure were based on the Cayenne/Touareg/Q7 platform. And "categorizing" the relationship between platforms and derivatives can get murky, so it was fair to suppose some Panamera structural or suspension components may have been based on Cayenne engineering.
But Porsche told the media implicity at the recent Panamera launch that the Panamera's platform is unique (thus presumably no basis on the Audi/Bentley/VW cars you mention, either), so I have amended the story to be clearer on the point of which Porsche/VW models are definitely structurally related. Thanks for flagging this for further clarification.
This still leaves up for discussion matters such as engine sharing, though, and whether that is a crucial element for the Porsche brand. The Cayenne and Panamera share V8s, for example, with several vehicles from the VW Group. -BV
Posted by: Bill Visnic | August 17, 2009 at 11:47 AM
Stunning pics, thanks for sharing them. My dream car has to be the 911, I would love to have a drive in the new turbo - what a stunning looking car! The 911 got a 5 star review here http://tiny.cc/ehNbg - im hoping to get hold of a used one soon! (Fingers crossed) Take care, good blogging with you
Posted by: exchangemart | August 18, 2009 at 6:40 AM
Interesting combination of Volkswagen & Porsche, which was hatching for long, is finally out. The brand name is going to be “Auto Union”. A bit nostalgic! But what could be the consequences on design?
Cheers VW!
Finally…… Its done!
With 49% stake in Porsche, VW has set it rolling.
For further details; visit: http://www.automotivecraze.com/volkswagen-and-porsche-merger/
Posted by: chris192 | August 23, 2009 at 11:10 PM