Porsche and Volkswagen announce merger plan

May 7, 2009

(ChattahBox) — Family owned Porsche announced it and fellow German auto maker Volkswagen agreed on Wednesday to forge a merged car giant, but also specified that the luxury sports car company would retain its independence.

Today’s news is another step in Porsche’s long journey which started in Sept. 2005, to take a true controlling interest in Volkswagen.

Stuttgart-based Porsche already has a 50 percent stake in Volkswagen still intends to raise its stake to 75% when economic conditions allow.

But laden with debt from the takeover, Porsche for now has dropped takeover plans and will pursue this merger.

Porsche, which had been seeking to take control of Volkswagen Europe’s biggest auto producer, said in a statement that the decision came after weeks of what Porsche called “intensive talks”.

The merged group would have 10 separate auto brands under one management, it said.

A special meeting of their boards and key shareholders in Salzburg, Austria gave themselves four weeks to agree to a tie up.


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