Porsche tightens grip on VW

VW now 30 per cent owned by Porsche

By Adam towler / Monday, 26 March 2007 / Loading comments

From strength to strength?

Porsche strengthened its grip on the VW empire over the weekend. The legendary sports car maker exercised an option to take an extra 3.6 per cent voting stake in VW, taking its holding to 30.9 per cent as of this Wednesday.

The move is significant because under German law, raising its stake past 30 per cent requires Porsche to make a mandatory takeover offer to the other VW shareholders. The speculation and interest surrounding Porsches stake in the company has driven up the VW share price by around a third this year to record highs.

A Porsche spokesman said at the weekend: "Porsche is firmly convinced that a closer bond with VW through an increase of the stake to more than 30 percent of the Volkswagen ordinary shares will produce benefits for both partners without diluting or indeed endangering the identity of Porsche. He also declared "we don't want a majority".

The move is the latest example of the extraordinary rise in power of Porsche, which just 15 years ago was teetering on the edge of oblivion.