Porsche has no plans to takeover Volkswagen

Porsche has no plans to takeover Volkswagen

Luxury car maker Porsche has increased its stake in Volkswagen above 30%. However, the company has no plans to acquire VW despite the fact that their move has triggered a mandatory takeover offer.

The company raised their stake in the company from 27.3 per cent to 30.9 per cent. Porsche said that this was done to protect Volkswagen from a hostile bid.

However, they would now have to launch the compulsory offer at €35 billion. Market experts believe that they would indeed raise their stake in the company to above 50 per cent.

Wendelin Wiedeking, the Porsche chief executive added that this increased stake in VW would enhance their business links with Volkswagen. He said: “We can now react even quicker should hedge funds want to take a stake in VW.”

Jens Schattner, an analyst with Dresdner Kleinwort had this to say about the whole development: “By offering the minimum bid price required, Porsche will be able to further increase its influence at VW without overpaying. Assuming that Porsche will move to 49.9 per cent in ords and prefs, we derive a new price target of €119 and recommend to use any bid-induced share-price weakness to build positions in Porsche.”

Porsche’s increased stake in VW is also expected to help them with their plans to expand their presence in emerging markets like China and India.