Atlanta, GA 6/29/2009 11:26:19 PM
News / Business

Porsche Declines Volkswagen's Offer for 49 Percent Stake

Porsche rejected Volkswagen AG’s offer to purchase a 49 percent stake in the German sports car company, a company spokesman said Monday.


Porsche Automobil Holding SE spokesman Albrecht Bamler said the offer by VW "is not a viable option," according to Associated Press.


According to Bamler, Porsche board chairman Wolfgang Porsche received the offer in a letter by courier last week. However, the company's CEO Wendelin Wiedeking and management board were not informed.


Porsche holds a roughly 51 percent stake in Volkswagen, but due to a large amount of debt, the company is looking to form a merger with VW in order to maintain its current stake.


German weekly Der Spiegel reported the VW offer was worth 3-4 billion euros, which would have helped Porsche pay off it debts, racked up in its attempt to take over VW.


However, according to Stamler, for VW to take a stake in Porsche, the automaker would have to take out credit worth 10.75 billion euros ($15.15 billion).


Porsche confirmed earlier this month it has been holding talks with the Qatar Investment Authority, a Qatar state investment fund, on a possible investment.


Volkswagen shares dropped 10.6 percent on the news to 237.91 euros in afternoon trading in Frankfurt.


Porsche shares crawled up nearly half a percent to 45.92 euros in Frankfurt.




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