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VW to Raise $5.7 Billion for Stake as It Fills in Details of Porsche Deal

By KATHARINA BECKER and WILLIAM LAUNDER

FRANKFURT — Volkswagen AG said Friday it would raise €4 billion ($5.7 billion) in capital to acquire a stake in the operating business of Porsche, as it fleshed out details of the highly indebted luxury sports-car maker’s merger with VW.

Volkswagen plans to acquire a 42% stake in Porsche AG, the sports-car arm and a 100% subsidiary of holding company Porsche Automobil Holding SE, for €3.3 billion by the end of 2009. A new name for the company created through the merger of Porsche and Volkswagen is yet to be decided, Volkswagen said.

Porsche said on Friday that Qatar Holding LLC will acquire 10% of the ordinary shares of the Porsche holding company from the family owners and the majority of Porsche’s cash-settled options on Volkswagen shares, freeing up more than €1 billion for Porsche that is currently serving as collateral for the options structure.
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Qatar now a shareholder in Porsche

Contract signing seals the deal

Stuttgart. This Friday, in a festive ceremony, Porsche Automobil Holding SE, Stuttgart, and Qatar Holding LLC (QH) signed an agreement signaling the entry of the Emirate of Qatar into the Porsche SE family. In the afternoon, the Chairman of the Supervisory Board of Porsche SE, Dr. Wolfgang Porsche, welcomed the high-ranking delegation from Qatar led by Prime Minister of the Emirate, Sheik Hamad ibn Jassim ibn Jabir Al-Thani, to the historical Porsche Villa located on Killesberg Hill outside of Stuttgart. There, in the presence of the Minister President of Baden-Württemberg, Günther Oettinger, the two men signed two contractual agreements.
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Porsche is the most attractive and liked brand in the USA

J.D. Power Study Distinguishes 911 and Cayenne

Stuttgart. For the fifth time in a row, Dr. Ing. h.c. F. Porsche AG took first place in the brand ranking from the latest opinion poll “Automotive Performance, Execution and Layout Study (APEAL)” conducted by the US market research institute J.D. Power. As a result, Porsche has succeeded in moving even further ahead of other premium manufacturers in the USA. Along with the outstanding overall rating of the brand Porsche, the sports car 911 Carrera and the sporty Cayenne SUV also earned hon-ors: Based on their equally high quality and esteem, customers confirmed the two model series as the best vehicles in their categories “Premium Sporty” and “Midsize Premium Multi Activity Vehicle”.

The APEAL study assessed the satisfaction of new car owners after the first 90 days. A total of approximately 81,000 people were asked to evaluate their vehicle according to 95 criteria in areas such as driving dynamics, power, design, comfort and suitability for everyday use in the period from February to May 2009. Already one month prior, the outstanding new car quality of Porsche earned second place in the equally prestigious study “Initial Quality Study” by J.D. Power. J.D. Power and Associates are among the leading and most renowned market research companies in the world.

(source Porsche SE)

Porsche woos Qatar investor

Editor: Chuck Penfold

German luxury sportscar maker Porsche says it’s negotiating with the Gulf state of Qatar as the exclusive candidate to buy a stake in the heavily-indebted company.

A Porsche spokesman in Stuttgart confirmed the news amid speculation of the possible involvement of a Middle Eastern investor. Details are still sketchy, but the Financial Times newspaper quoted sources close to the talks as reporting that the Qatar Investment Authority was interested in a stake of up to 25 percent in Porsche’s holding company.

Analysts say such an investment would considerably strengthen Porsche’s bargaining power in troubled merger talks with Volkswagen.

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Porsche Said to Be Examining Sale of VW Stock Options

By Chris Reiter

(Bloomberg) — Porsche SE, strained by 9 billion euros ($12.5 billion) in net debt, may sell its options on Volkswagen AG shares to an investor as the sports-car maker seeks to combine with VW, a person familiar with the plan said.

Porsche is examining a sale of the call options that can be converted into about 20 percent of VW as part of its discussions with investors, said the person, who asked not to be identified because the negotiations are private. The move may help Stuttgart, Germany-based Porsche raise money before a planned integration with Europe’s largest carmaker, the person said.

Porsche may be unable to exercise the options, which have helped the carmaker’s profits exceed sales, as it struggles to raise fresh financing, analysts including UniCredit SpA’s Georg Stuerzer have said. Germany’s government said today it needs more time to consider Porsche’s request for a 1.75 billion-euro loan from KfW Group, the country’s state-owned development bank.

“It’s not clear that Porsche would achieve much de- leveraging in a sale,” said Philippe Houchois, an analyst at UBS AG in London. “The options might be worth nothing.”

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