Volkswagen may complete Porsche takeover this year, report says

BERLIN -- Volkswagen Group may this year complete the purchase of the 50.1 percent of Porsche Automobile Holding SE's automotive business that it does not already own for 3.9 billion euros, a German magazine said.

VW will get around having to pay more than 1 billion euros in taxes if completing the purchase before 2014 by setting up a holding company to temporarily take control of the stake, Der Spiegel reported, citing unidentified VW managers.

Volkswagen will also take steps to ensure Porsche's independence within the VW group to get over resistance from Porsche labor leaders, the magazine said.

VW already owns 49.9 percent of Porsche's automotive unit.

VW is "still in the process" of deciding on a plan to integrate with Porsche SE's automotive business, Christine Ritz, a VW spokeswoman, said on Sunday.

"Of course all the parties are interested in achieving the goal of an integrated automotive group as soon as it makes economic sense to do so," Ritz told Bloomberg. "As soon as we have made a decision to achieve that goal, we will communicate that."

Ritz declined to comment on the report in Der Spiegel.

"As we said in September, we want to check alternatives and that process is ongoing," Frank Gaube, a Porsche spokesman, said by telephone, declining to comment further.

Big savings
Volkswagen has said that the combination with Porsche will boost profitability and save 700 million euros. VW, whose main luxury brands include Audi, Lamborghini and Bugatti, makes more vehicles in a week than Porsche does in a year.

The two companies had worked on a full-blown merger since 2009, when Porsche failed in a hostile attempt to take over VW, the sports-car maker's biggest supplier. Porsche racked up more than 10 billion euros of debt as it purchased the majority of VW's common shares.

Short sellers of VW stock sued Porsche in the U.S., claiming it secretly piled up VW shares and later caused the investors to lose more than $1 billion.

Claimants in Germany have also sought damages, while prosecutors in Stuttgart, where Porsche is based, are investigating suspicions that the sports-car maker didn't adequately inform investors about its plan to take control of VW. Porsche has repeatedly denied all allegations of wrongdoing.

Source: Bloomberg 

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