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OPTICAL AND HEARING
2005 Porsche Cayenne
26th September, 2005
Dr. Ing. h.c. F. Porsche AG, Stuttgart, announced yesterday that it would seek to acquire a share of approximately 20 per cent in the stock capital of Volkswagen AG, Wolfsburg; thereby giving Porsche AG voting entitlements.
The decision by Porsche to seek a 20 per cent stake is to secure business relations between the two German companies. Volkswagen is an important development partner for Porsche and responsible for supply of parts for approximately 30 per cent of Porsche’s sales volume.
“In making this investment we seek to secure our business relations with Volkswagen and make a significant contribution to our own long-term future plans," says Porsche’s President and CEO, Dr Wendelin Wiedeking.
Porsche is in a position to finance the acquisition of the planned share in Volkswagen through its own, existing liquidity. After careful examination of this business case, Porsche is confident that the investment will prove profitable for both parties.
The Supervisory Board has authorised Porsche’s Board of Management to implement the plan. Porsche is in contact with the Board of Management of Volkswagen in order to scrutinise and verify the options available in accordance with appropriate resolutions already taken at Volkswagen’s General Meeting. The assumed share will not under any circumstances reach the threshold at which Porsche would be required to submit a public bid for the takeover of Volkswagen.
The planned acquisition is to prevent a hostile takeover of Volkswagen by investors not committed to Volkswagen’s long-term interests. Otherwise, the anticipated decision of the European Court of Justice to abolish the VW Act (by no later than mid 2007) would leave the company open to such an unwanted takeover.
“We wish in this way to ensure the independence of the Volkswagen Group in our own interest. This avenue we are pursuing is an essential prerequisite for the stable development of the Volkswagen Group and, accordingly, for continuing our cooperation in the interest of both companies,” says Dr. Wiedeking.
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