Porsche gets OK for majority stake in Volkswagen
Europe could see a new automobile and truck empire emerge after Porsche got clearance from its board Monday to take a majority stake in Volkswagen -- just as VW said it would amass a controlling interest in Swedish truck maker Scania.
The moves could also put Porsche Automobil Holding -- which owns Porsche and a nearly 31% stake in Volkswagen -- in a position to absorb a new commercial truck giant combining Scania with German truck maker MAN, in which Volkswagen holds 29.9%.
Analysts said both deals boiled down to making money -- lots of it.
Porsche has been steadily raising its stake in Volkswagen for more than a year and won a significant victory last year when the European Union’s highest court ruled that the German government had to remove a cap on voting rights at VW.
Porsche has not said when it would resume building its holdings in Volkswagen, only that it was now free to do so, and has said it does not plan to fully merge the companies. But the approval that Porsche’s supervisory board granted Monday for the company to raise its stake opens up a realm of possibilities.
“Volkswagen has announced that they’re taking a majority share of Scania. Next they could upgrade their stake in MAN to a majority stake, merge the two companies into a Volkswagen Commercial and sell that to Porsche,” said Christoph Stuermer, an auto analyst with Global Insight.
“Then they could hand back to Porsche . . . or to their stock owners, a special dividend from the revenues of that sale.”
Holding company Porsche came into being after the sports-car maker boosted its stake in VW to nearly 31% last year. Since the European court ruling, speculation had swirled over when Porsche actually might move to take a majority.
“The reviews by the regulatory authorities are expected to take several months,” Porsche said.
“As soon as the requisite clearances have been obtained, Porsche can acquire the majority of the shares in Volkswagen.”
It added that “it is not planned to merge the two companies.”
Porsche Chief Executive Wendelin Wiedeking said that owning a majority stake would help Porsche work with VW -- whose brands include Audi, Skoda, Seat, Lamborghini, Bentley and Bugatti -- in developing new models, engines and other components.
Analysts also say Porsche’s having a dominant and controlling stake in Volkswagen could help improve VW’s weak showing in the U.S. -- a key market for Porsche.
Whatever uncertainty remains about Porsche’s plans for Volkswagen, VW seemed certain of its plans for Scania, agreeing to pay at least $2.8 billion to buy key stakes in the Swedish truck maker from Investor AB and the Wallenberg Foundations.
That deal could clear the road for new talks about merging Scania with German rival MAN, which had made a failed hostile bid worth about $15.6 billion to acquire its rival.
