[Dippy]

Volkswagen finally takes 49.9 percent state in Porsche. More info below from the Press Release below

Volkswagen takes 49.9 percent stake in Porsche AG

Further milestone reached on the way towards the integrated automotive group with Porsche



Wolfsburg, December 08, 2009 – Volkswagen Aktiengesellschaft has today taken a 49.9 percent stake in Porsche AG. The next important step on the way towards the integrated automotive group with Porsche has therefore been completed, as announced, before the end of the year. The price for the stake is €3.9 billion and is based on the enterprise value for Porsche AG calculated under a careful due diligence and valuation procedure.



Following the Comprehensive Agreement concluded in August, the implementation agreements signed in November and the Volkswagen Extraordinary General Meeting held last week, the stake in Porsche AG represents the next milestone on the way towards the integrated automotive group with Porsche under the leadership of Volkswagen. The acquisition of the trading business of Porsche Holding Salzburg is planned for 2011. The creation of the integrated automotive group is then to conclude with the merger of Volkswagen AG and Porsche SE during the course of the same year.



The combination of the two companies follows a compelling strategic, industrial and financial logic. For the Volkswagen Group, Porsche ideally complements the brand portfolio. The Stuttgart-based car maker will allow Volkswagen to further expand its position in the premium business, which offers particularly strong earnings. In turn, as an independent brand under the roof of the Volkswagen Group, Porsche will have the potential for significant additional growth.



The transaction will have a sustained positive effect on the earnings situation of the Volkswagen Group. With a return on sales of 10.3 percent, Porsche AG is the world’s most profitable automobile manufacturer. Volkswagen will in future participate in this business success through its stake. In addition, the planned integration of Porsche in the Volkswagen Group and the associated closer cooperation will realize significant synergies on both the income and the cost side. As a result, the annual operating profit of the Volkswagen Group is expected to increase by some €700 million in the long term.

[Dante]

Thanks for the news dippy. Thats almost 50% stake.
VW will enjoy the worlds most profitable automobile manufacturer's returns.

[raul]

VW is on a buying spree, apparently VW has now picked up 19.9% of Suzuki. What does this mean for India?

Hungry Volkswagen adds Suzuki to its stable!

[arjunrudra]

Think its the other way round : VW to acquire porsche. They are definitely on a buying spree , what about our indian suzuki , does this mean any change to us ?

[Jayabusa]

Originally Posted by arjunrudra

Think its the other way round : VW to acquire porsche. They are definitely on a buying spree , what about our indian suzuki , does this mean any change to us ?

Buddy, Suzuki isn't Indian, it's Japanese. Maruti Suzuki(collaboration) work in India.

[arjunrudra]

Originally Posted by Jayabusa

Buddy, Suzuki isn't Indian, it's Japanese. Maruti Suzuki(collaboration) work in India.

Cant believe i made that mistake , anyways what will happen to the indian maruti's .Any idea ?

[subhashnm]

VW and Porsche: What a classic business rivalry saga! Both companies sharing the same roots and being run by relatives trying to take over each other for years. And finally one wins over the other and they all bury the hatchet and decide to do the journey togehter. All is well that ends well!

VW surely is on a roll. How many brands does it have under its umbrella? Porsche(now), Audi, Skoda, Seat, Lamborghini and Bently. Am I missing any here? I think they are becoming a serious contender to the throne of Toyata as world's biggest car manufacturer. With second position in the biggest car market in the world (China, through a JV) and a newly acquired position in the fastest growing car market in the world (India, through the Suzuki deal), they are positioning themselves to challenge Toyota in the next stage of automotive growth phase.

If Toyota doesn't take the effort to sit down and understand the customers of developing countries, it is going to lose much more than a few market share percentage points, I feel!