Volkswagen says it plans to buy Porsche auto unit

24th July 2009, Comments 0 comments

The Volkswagen supervisory board Thursday approved a plan to create an integrated automaker with Porsche.

Frankfurt -- Volkswagen, the biggest European carmaker, said Thursday it planned to take over the automobile activities of its main shareholder Porsche and to merge the two companies.

The VW supervisory board approved a plan to create an integrated automaker with Porsche, a statement said a few hours after Porsche's board had also given the deal a green light.

"The integrated group should emerge from the progressive acquisition by Volkswagen of a participation in Porsche SA and the complete mergers of Porsche SE and Volkswagen AG," the VW statement said.

Porsche SA is Porsche's core automaking unit, while Porsche SE is the overall holding company.

Within that framework, the Gulf state of "Qatar will buy around 17 percent of the stock options" in VW, chief executive Martin Winterkorn told media after an extraordinary meeting of VW's supervisory board.

That meant the Gulf emirate would take a direct 17 percent stake in VW by acquiring stock options owned by Porsche.

Qatar is also to take a stake in Porsche, which said earlier on Thursday that it would raise at least 5 billion euros (7 billion dollars) in fresh funds via a capital increase.

All details of the operation are to be released during a meeting of the VW supervisory board on August 13, Winterkorn said.


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