Saturday, June 27, 2009

Porsche accuses Volkswagen and Lower Saxony of extortion


When you here about the conflicts involved with the Porsche/Volkswagen merger, you never really think of the words “Match made in heaven.” According to Reuters, Porsche is now accusing Volkswagen and its key shareholders Lower Saxony of extortion following a magazine report that the two had demanded that Porsche accept a merger of the two automakers with Volkswagen taking lead charge.

German magazine Der Spiegel reported earlier today that Porsche CEO Wendelin Wiedeking and Chairman Wolfgang Porsche had been pressed to agree on a merger by the end of June where Volkswagen would take a 49 percent stake in Porsche for $4.2 to $5.6 billion.

The German publication also reported that Volkswagen threatened Porsche to pay back a 700 million euro loan it had provided to the sports car manufacturer back in September.

Porsche’s Chairman Wolfgang and deputy Uwe Hueck have released a statement saying they had been given an ultimatum by Volkswagen and Lower Saxon.

“We will not accept extortion. … Ultimatums do not belong in the 21st century,” the two said. “We hope very much in the interest of the common goals that the authors of the ultimatum regain their calm and will pursue their proposals in internal talks and not via headlines”

Der Spiegel said that Volkswagen proposed that the Emirate of Qatar would by Porsche’s Volkswagen stock options.

Volkswagen would not comment on the report or Porsche’s statement and the Emirate of Qatar was not immediately available for comment.

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