Porsche-Volkswagen

Porsche AG and Volkswagen AG, linked by the wealthy Porsche clan, have  spent the better part of a year circling each other for control. Follow the companies' saga below through its many twists and turns.

2009

Aug. 21: Porsche inquiry renews option debate: During Porsche AG's stormy, ill-fated battle to take over Volkswagen AG, the luxury sports carmaker became known for short, heavy-handed press releases denying accusations and trumpeting its superior strategy. Those press releases are some of the many documents seized by German prosecutors who late Thursday raided Porsche's headquarters as part of an investigation into possible market manipulation by the company's former CEO Wendelin Wiedeking and CFO Holger Härter, among others. The investigation is a surprising late-act twist to a long running corporate and family drama -- members of the wealthy Porsche clan control the sports car manufacturer and own a substantial stake in VW -- that ended on Aug. 13 when VW agreed to a gradual takeover of Porsche. The charges have also rejuvenated a debate about how cash-settlement options are regulated in Europe's biggest economy. - Andrew Bulkeley

Aug. 20: Porsche headquarters raided by regulators: German prosecutors on Thursday morning raided Porsche Automobil Holding SE's headquarters in Struttgart, Germany, on suspicion of a breech of the country's securities laws and potential market manipulation. It's unclear at this time if the investigation is linked to Porche's failed takeover of Volkswagen AG last year. Porsche is now in the process of being acquired by VW. - Sara Behunek

Aug. 20: The Volkswagen-short seller redux: Short sellers are once again placing bearish bets on Volkswagen AG, showing that hedge fund managers hit last year by radical price swings in VW's stocks haven't been scared away from investing in the German market permanently, as some had feared. According to The Wall Street Journal, hedge fund managers have nearly doubled their short positions on VW stock since mid-July. So far, the bet has paid off. Volkswagen's stock has fallen more than 42% since Aug. 13, when Volkswagen announced that it would launch a phased takeover of Porsche Automobil Holding SE, to be completed by 2011. - Sara Behunek

Aug. 17: Investors dump VW stock: Investors continued to pile out of Volkswagen AG on Monday after the company said it would raise €4 billion ($5.6 billion) to fund the purchase of a 42%  Porsche AG stake as part of a gradual takeover of the namesake German sports car company. VW shares were down €19.16, or 10%, to €173.34 late Monday afternoon in Frankfurt, bringing their two-day decline to roughly 25%. Investors worry about the share offering and a higher-than-expected valuation of Porsche. - Andrew Bulkeley

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Aug 14: VW agrees on phased Porsche takeover:  Volkswagen AG late Thursday presented its road map for a gradual takeover of Porsche AG, and its first move will be a €3.3 billion ($4.7 billion) purchase of a 42% stake in Porsche's sports car business by the end of this year. VW aims for a full merger of the two companies in 2011. - Andrew Bulkeley

Aug. 14: Qatar takes 10% Porsche stake: Porsche AG agreed Friday to sell a 10% voting stake and most of its stock options in Volkswagen AG to Qatar Holding LLC for €1 billion ($1.4 billion). The move came less than a day after the debt-laden sports carmaker agreed to key terms of its gradual takeover by VW. VW, which Porsche had once hoped to acquire, said Aug. 13 it will pay €3.3 billion for a 42% stake in Porsche's sports car business by the end of this year. VW aims for a full merger of the two companies in 2011. - Andrew Bulkeley

July 30: VW trumpets its cash pile: Volkswagen AG on Thursday trumpeted its rising cash hoard just days after widespread reports predicted the German carmaker would have to tap shareholders to proceed with its plan to acquire luxury carmaker Porsche AG. Wolfsburg-based VW had €12.3 billion ($17.3 billion) in cash as of Thursday, €4.3 billion more than at the end of 2008 but about €3 billion less than it had after the first half of 2008. VW and its supervisory board chairman Ferdinand Piech recently won a hard-fought battle for control of both VW and Porsche. Porsche, of Stuttgart, Germany, wracked up €9 billion in liabilities last year buying 51% of VW. - Andrew Bulkeley

July 29: Porsche warns of $7B loss: Porsche AG paid a hefty price in its failed attempt to acquire Volkswagen AG. The luxury sports carmaker made that clear Wednesday when it issued a profit warning just days after the surprise ouster of the company's two top executives. Porsche of Stuttgart, Germany, said it expects a pretax loss of up to €5 billion ($7 billion) for the year ending July 31, following a profit of €8.6 billion in fiscal 2009. - Andrew Bulkeley

July 23: VW's Piech wins battle with Porsche: Just hours after the surprise departure of Porsche AG's top two executives, the future of both the German sports carmaker and its Volkswagen AG subsidiary became clearer after extraordinary meetings of both the Porsche and VW supervisory boards. Both panels supported plans to merge Porsche and VW, with Porsche remaining an "independent label" within a company with nine other brands, VW chief executive Martin Winterkorn told reporters following the meeting in Stuttgart on Thursday. The Gulf emirate of Qatar will also take about 17% of VW through options banks hold on behalf of Porsche by banks, Lower Saxony state Prime Minister Christian Wulff said after the meeting. Lower Saxony owns 20% of VW, giving Wulff a supervisory board seat. - Andrew Bulkeley

June 22: Porsche rejected for $2.4B in car financing: In an odd twist, luxury sportscar maker Porsche Automobil Holding SE has been turned down for a car loan because of its credit. With its long-running quest to take over Volkswagen AG draining its cash reserves, Porsche had asked the German government for a $2.43 billion loan, but was rejected Monday according to the Financial Times. - George White

June 15: Qatar's getting a new $3.45B Porsche: There may soon be a brand new Porsche in the driveway of the Qatar Investment Authority. The Middle Eastern sovereign wealth fund is reportedly close to a deal with Porsche AG to buy a stake in the carmaker for as much as $3.45 billion. The sale of 25% of the company could be finalized by the end of June, unnamed sources told Bloomberg.  - George White

June 3: Porsche seeks government assistance: Porsche Automobil Holding SE will turn to the German government to fill a €1.75 billion ($2.49 billion) hole in its finances as it continues to lug around €9 billion in debt largely amassed by buying a stake in on-again, off-again merger partner Volkswagen AG. Porsche, of Stuttgart, has asked the state-owned Kreditanstalt für Wiederaufbau reconstruction bank for a €1.75 billion loan, a spokesman told Reuters Wednesday. -  Andrew Bulkeley

May 26: Porsche scours for new financing: Porsche AG on Tuesday continued its drive for €1.75 billion ($2.45 billion) in financing even as it remained at odds with affiliate and potential merger partner Volkswagen AG. Porsche, of Stuttgart, recently secured a €750 million credit line from Bank of Tokyo-Mitsubishi UFJ Ltd. and is in talks with other lenders, including the German government's Kreditanstalt für Wiederaufbau reconstruction bank about raising additional cash to finance its operations and service its €9 billion in debt, according to widespread press reports. -  Andrew Bulkeley

May 19: Porsche in talks with unnamed investor: Porsche AG is threatening to take its 911 sportscar and drive home. The Stuttgart, Germany, company said Tuesday it was in "promising" talks with an unnamed investor a day after Volkswagen AG, in which it has a 51% stake, walked away from talks about a planned joint future, according to Reuters. -  Andrew Bulkeley

May 18: VW, Porsche merger talks stall: As the hometown of German carmaker Volkswagen AG prepares for its soccer team's first ever league championship, VW supervisory board chairman Ferdinand Piech is battling to emerge victorious from a match with cousin Wolfgang Porsche, his counterpart at sports carmaker Porsche AG. A meeting between the two car companies slated for Monday, May 18, was cancelled, with VW suggesting Porsche wasn't doing enough to make its difficult financial situation transparent. VW's labor council head, Bernd Osterloh, also demanded the negotiations be stopped. Both companies insist the talks will continue, however. - Andrew Bulkeley

May 12: VW to call shots at Porsche: Volkswagen AG supervisory board chairman Ferdinand Piech has made it clear that he won a family battle over the future of sister company Porsche Automobil Holding SE as Russian carmaker OAO Gaz confirmed it wants to join a Magna International Inc. bid for General Motors Corp.'s Adam Opel AG. In remarks released Tuesday, Piech said a merged Porsche and VW would be based at VW's Wolfsburg, Germany, headquarters and current VW executives, not the Porsche top brass, would likely lead it. - Andrew Bulkeley

May 7: Analysts parse Volkswagen-Porsche merger : Since Porsche Automobil Holding SE unveiled a broadbrush agreement late Wednesday to merge with Volkswagen AG, much uncertainty has surrounded the plan, though analysts agree the Porsche family and its luxury sports car brand will cede some power to the much larger mass-market specialist, VW. Porsche supervisory board chairman Wolfgang Porsche and Ferdinand Piech, his VW counterpart and cousin, agreed during a meeting in Salzburg, Austria, to create a company with 10 brands, including VW, Skoda, Lamborghini and Porsche. - Andrew Bulkeley

May 6: Porsche, VW integration plans: Germany's Porsche Automobil Holding SE and Volks­wagen AG met on Wednesday to discuss a plan where 10 brands would stand under an integrated company, nine are owned by VW with the other being the iconic Porsche brand. - Baz Hiralal

May 4: Owners of Porsche, VW will meet: The family owners of German auto dynasties Porsche Automobil Holding SE and Volkswagen AG are reportedly set to meet Wednesday to smooth out the S-curves that developed in Porsche's high-profile acquisition of its mass market sister. Widespread media accounts on Monday report that the battle centers on the €23 billion ($30.8 billion) Porsche has spent so far amassing a 50.78% VW stake, which has left the hard-charging luxury sports car maker with €9 billion in liabilities. - Andrew Bulkeley

April 23: VW turns tables on Porsch: Family reunions among the Piëch and Porsche clans must be as tense as a Bancroft get-together during Rupert Murdoch's run at The Wall Street Journal back in 2007. The related German families own the eponymous sports car maker Porsche Automobil Holding SE and now hold 50.78% of mass-market leviathan Volkswagen AG after Porsche aggressively bought Volkswagen shares on the market last year. But media reports Thursday said it is now Volkswagen -- under the leadership of chairman Ferdinand Piëch -- that is kicking the tires at its smaller tormentor. - Jonathan Braude

March 31:Porsche drives off with $9B: While most carmakers are having a difficult time making money from car sales, sports carmaker Porsche AG is raking in profits by playing the market. Porsche revved up its first half with €6.8 billion ($9 billion) in windfall profits from the sale of its share options in Volkswagen AG, allowing the carmaker to report a pretax profit that was more than twice its revenue. - George White

March 25: Porsche secures VW loan: Germany's Porsche SE on Wednesday said it successfully renewed a €10 billion ($13.5 billion) line of credit that will allow it to boost its stake in Volks­wagen AG to a clear majority. The company even convinced banks to give it an extra €2.5 billion. Porsche, which operates out of Stuttgart, said a group of 15 banks offered it a 12-month loan with an option to increase the agreement to a total of €12.5 billion. About €6.7 billion may be extended beyond the 12-month expiration, it said. - Andrew Bulkeley

2008

Oct. 27: Porsche turning corner on Volkswagen: Porsche Automobil Holding SE said it was just 0.9% short in ownership stake of Volkswagen AG that would allow it the right to register the target's revenues and assets in its owns books. Porsche said on Sunday it had nearly a 75% stake in Volkswagen, 31.5% through cash-settled options and an additional 42.6% it currently owns. "The goal is to raise this to 75 percent in 2009, so long as the economic conditions permit, and pave the way for a domination agreement," Porsche said. - Gerald Magpily

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