Volkswagen - Porsche merger now a done deal
In a time when mergers between automakers have become more and more frequent, arguably the biggest unification between two powerhouse car brands has finally been completed.
Volkswagen, the current holder of ‘Europe’s largest automaker’ title, has now completed its merger with Porsche, with the tie-up resulting in an integrated auto group marked under the banner of Volkswagen. The finalized deal comes as the culmination of months of intense negotiations that boasted its fair share of twists and turns that could put a soap opera to shame.
Ironically, it was Porsche that made the first attempt at purchasing Volkswagen after buying a 51% stake in the former’s operations with an aim at increasing it to 75%. But, in a somewhat complicated twist of fate, Porsche ended up losing billions of dollars as a result of the economic crisis, which forced the boys from Stuttgart to come knocking in VW’s door for some much-needed assistance.
Continued after the jump.
The merger calls for VW to purchase a 42 percent stake in Porsche’s auto unit by the end of 2009 with a target completion of purchase by 2011 – provided that all the necessary stages of the merger are met. The result, as you can expect, is the formation of an automotive conglomerate that already boasts of 10 brands, which already includes, among others, Audi.
Similar to VW’s deal with Audi, Porsche will remain an independent company.
According to Martin Winterkorn, Chairman of VW’s Board of Management: "Volkswagen and Porsche today took a decisive step towards a joint future. As a group with now ten strong, independent brands we will further expand our unique global position."
It’s no secret that Volkswagen has long desired to be the world’s top automaker, even pegging 2018 as the year it hopes to overtake Toyota for first place. The acquisition of Porsche, together with its other brands like Audi, goes a long way in bolstering that mission.
"More than ever before, we now have what it takes to become the automotive industry’s number one. Volkswagen is systematically continuing its successful multibrand strategy by integrating Porsche,” Winterkorn adds.