Porsche owned by VW Law
07-22-2009, 08:17 AM
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Porsche owned by VW Law
Wendelin Wiedeking, the highly regarded chief executive of Porsche who is now blamed for incurring huge debts to finance a bid for Volkswagen AG, may be pushed out of his job, according to German news reports.
The latest report — from the weekly Der Spiegel — says Wiedeking is preparing to step down, and a successor has been agreed to by the sportscar manufacturer’s controlling shareholders, the descendants of Ferdinand Porsche.
“The company officially claims that he will stay on in his role, but press speculation in Germany is intensifying that Wiedeking will be the scapegoat for Porsche’s failed attempt to take over Volkswagen,” said Tim Urquhart, London-based auto analyst at IHS Global Insight.
In 2005, Porsche began amassing shares in the much larger Volkswagen — whose chairman, Ferdinand Piëch, is a grandson of Ferdinand Porsche and a major shareholder in Porsche.
Porsche’s predatory moves, supported by Porsche Chairman Wolfgang Porsche, Piëch’s cousin, created a rift in the family. But Piëch reserved his public criticism for Wiedeking.
Porsche ran up debts estimated at nearly $20 billion to buy a majority of VW’s stock — yet doesn’t control the company. “Despite the fact that Porsche now has a majority stake in VW of 50.76 percent, it still does not have full managerial control over the company as a result of the continuing presence of the VW Law,” Urquhart said.
The controversial VW Law gives the German state of Lower Saxony veto power over major corporate decisions even though it owns only 20.1 percent of the automaker.
The state of Lower Saxony tends to support Piëch, who has been careful to preserve employment during his long and influential career at Volkswagen.
The extended Porsche family is now seeking a way to integrate the two companies.
On Thursday, the supervisory boards of both Volkswagen and Porsche will meet in Stuttgart, where Porsche has its headquarters. Among the topics to be discussed is a counter-offer by Volkswagen for Porsche.
According to the Süddeutsche Zeitung, two representatives of the family owners have told Wiedeking that he did not have a future with the company.
“It appears that many of the press stories that Wiedeking is poised to leave the company have been placed by Piëch allies, but crucially, Wolfgang Porsche has done little to dampen the speculation,” Urquhart said in a report.
Wiedeking became Porsche’s chief executive in 1993 and is credited with restoring the troubled firm’s financial health and expanding its lineup.
He has been seeking to shore up Porsche’s finances by inviting the emirate of Qatar to take a stake in the company.
According to several news reports, Wiedeking would be succeeded by Porsche’s current head of production, Michael Macht.
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The latest report — from the weekly Der Spiegel — says Wiedeking is preparing to step down, and a successor has been agreed to by the sportscar manufacturer’s controlling shareholders, the descendants of Ferdinand Porsche.
“The company officially claims that he will stay on in his role, but press speculation in Germany is intensifying that Wiedeking will be the scapegoat for Porsche’s failed attempt to take over Volkswagen,” said Tim Urquhart, London-based auto analyst at IHS Global Insight.
In 2005, Porsche began amassing shares in the much larger Volkswagen — whose chairman, Ferdinand Piëch, is a grandson of Ferdinand Porsche and a major shareholder in Porsche.
Porsche’s predatory moves, supported by Porsche Chairman Wolfgang Porsche, Piëch’s cousin, created a rift in the family. But Piëch reserved his public criticism for Wiedeking.
Porsche ran up debts estimated at nearly $20 billion to buy a majority of VW’s stock — yet doesn’t control the company. “Despite the fact that Porsche now has a majority stake in VW of 50.76 percent, it still does not have full managerial control over the company as a result of the continuing presence of the VW Law,” Urquhart said.
The controversial VW Law gives the German state of Lower Saxony veto power over major corporate decisions even though it owns only 20.1 percent of the automaker.
The state of Lower Saxony tends to support Piëch, who has been careful to preserve employment during his long and influential career at Volkswagen.
The extended Porsche family is now seeking a way to integrate the two companies.
On Thursday, the supervisory boards of both Volkswagen and Porsche will meet in Stuttgart, where Porsche has its headquarters. Among the topics to be discussed is a counter-offer by Volkswagen for Porsche.
According to the Süddeutsche Zeitung, two representatives of the family owners have told Wiedeking that he did not have a future with the company.
“It appears that many of the press stories that Wiedeking is poised to leave the company have been placed by Piëch allies, but crucially, Wolfgang Porsche has done little to dampen the speculation,” Urquhart said in a report.
Wiedeking became Porsche’s chief executive in 1993 and is credited with restoring the troubled firm’s financial health and expanding its lineup.
He has been seeking to shore up Porsche’s finances by inviting the emirate of Qatar to take a stake in the company.
According to several news reports, Wiedeking would be succeeded by Porsche’s current head of production, Michael Macht.
More...
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