Volkswagen Halts Merger Talks with Porsche

May 18, 2009

(ChattahBox) — Volkswagen abruptly announced on Sunday that it was canceling merger talks with Porsche for the time being.  “The atmosphere is not a constructive one,” Peik von Bestenbostel, a Volkswagen spokesman, said in explaining the decision to cancel the meeting. About two weeks ago family owned Porsche announced it and fellow German auto maker Volkswagen agreed on to forge a merged car giant.

Stuttgart-based Porsche already has a 50 percent stake in Volkswagen and intended to raise its stake to 75% when economic conditions allow. Shares of Porsche AG fell as much as 9% on Monday following this weekend reports that merger talks with Volkswagen AG have been suspended.  The two companies had its first meeting last week, but according to reports, Volkswagen became impatient with what it saw as the high-handedness of the Porsche chief executive, Wendelin Wiedeking, and his team.  Porsche insisted, however, that only one meeting had been canceled and the deal talks were ongoing.


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