Jul 18, 2009, 5:01 p.m. EST
VW near deal to buy Porsche: reports


By MarketWatch
LOS ANGELES (MarketWatch) -- Debt-saddled Porsche Automobil Holding SE is close to a deal in which it would be acquired by Volkswagen AG, according to media reports Saturday.
Associated Press cited the German weekly news magazine Der Spiegel as saying that Wolfsburg, Germany-based Volkswagen , Europe's largest automaker, would initially get 49.9% of Porsche's shares and later take the remaining stake in the company.
AP cited a person familiar with the talks who said a deal was likely.
That came on the heels of a report late Friday in the online edition of The Wall Street Journal that said Porsche Chief Executive Wendelin Wiedeking is expected to relinquish "operational control" of the German car maker in a reversal of its attempt to take over Volkswagen.
The Journal, citing unnamed sources, reported that Weideking's stepping aside would open the way for VW to assert more control over Porsche's car-making arm, "and could end a more than three-year battle between the two German auto companies that are linked by family stakeholders."
According to a compromise under consideration, Weideking would retain his CEO title at Porsche's holding company, the report said, while noting that Porsche has repeatedly denied that Wiedeking is on his way out.
Porsche has been raising its own stake in VW since 2005, reaching nearly 51% with a set of options to buy a further 20% portion, according to the report. However, Porsche's net debt has reached "unsustainable" levels more recently because of the global economic downturn.

 

Doesn't surprise me, Porsche bit off more then they could chew, and then world economy took a dive!

Hopefully VW let's the company run itself, and keep producing high quality cars. This does solve Porsche's CAFE question.

 

I just hope VW doesn't run it like VW . I can speak volumes of an 01 Jetta (not my car) which was the worst car I have ever seen right from day one.

 

Porsche lost their financing (due to the credit crunch) and the deal fell through...

We bought a new '05 Touareg and it was a great vehicle...built like a tank.