Porsche raises billions to clear debts

14th April 2011, Comments 0 comments

German luxury carmaker Porsche said Thursday it had raised nearly five billion euros ($7.2 billion) from a rights issue that it would use to pay down debt before its planned merger with Volkswagen.

The firm issued more than 131 million shares at 38 euros per share, raising a total of 4.9 billion euros between March 30 and April 12.

Porsche is working to cut its debt mountain of 6.34 billion euros so it can be integrated into the Volkswagen group.

The move is an "important step on the road to an integrated car company," said Martin Winterkorn, chief executive of the two companies.

While both firms want to accelerate the merger, legal difficulties threaten to slam on the brakes and Porsche has conceded that it may not go ahead this year.

© 2011 AFP

0 Comments To This Article