Earlier in the day today Porsche SE released a statement indicating their interest in forming closer ties with Volkswagen AG. The release went on to say that if the proposed plans were adopted, the two automotive companies would join to create an "integrated" car maker uniting 10 brands under one roof. But, and this is a big but, still allowing Porsche its independence.
While the release doesn't come out and say it directly (full text of the release is below for your review) this looks to be a step back for Porsche. Distilled down to the bare essentials Porsche is basically ending their bid for a takeover of the much larger Volkswagen and instead moving toward a merger of the two companies.
Porsche's current ownership of VW stands at 51% and falls significantly short of the 75% needed for a true majority ownership. Volkswagen, the largest European automaker, consists of nine brands including, Volkswagen, Lamborghini, Skoda, Bentley, Bugatti, Audi, Scania, Seat and Volkswagen Commercial Vehicles.
While a merger may help both companies in creating even more efficiencies and economies of scale, it's unclear at this point just how such a merger would work given that, "In the final structure ten brands shall stand below an integrative leading company alongside each other, whereby the independence of all brands and explicitly also of Porsche shall be ensured."
In my experience, when an announcement comes directly from Porsche SE, rather than through the normal PR channels of PCNA, the news is intentionally ambiguous. This type of information release leaves Porsche room for significant changes and an open door to move in any direction they choose. Read the release below and decide for yourself.
Porsche Family Shareholders in Agreement over Intention of Integrated Car Manufacturing Group
Stuttgart. The members of the management boards of both Volkswagen AG and Porsche Automobil Holding SE have been in intensive talks about the deepening of the cooperation over the past weeks. The family shareholders of Porsche Automobil Holding SE, Suttgart, have discussed the proposals resulting therefrom, with the inclusion of capital measures, this Wednesday and argued for the creation of an integrated car manufacturing group. In the final structure ten brands shall stand below an integrative leading company alongside each other, whereby the independence of al brands and explicitly also of Porsche shall be ensured.
On this basis both companies Volkswagen and Porsche intensify the talks in a joint working group with the relevant involvement of the State of Lower Saxony as largest co-shareholder as well as the employee representatives of both companies. It is the aim to develop a corresponding basis for decision-making on the future structure of the common group within the next four weeks.
[Source: Porsche SE]