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Porsche offers to buy Audi

rybo submitted on 9/29/2008 Official Bell & Ross Timestamp: 11:31:21 AM

20 user comments | Category: Misc News | Source: | SOURCE: www.motorauthority.com

Porsche announced earlier this month that it had raised its stake in Volkswagen Group to 35% - up from 31% - and in doing so made VW a subsidiary of Porsche Automobil Holding under German law.



Under that same law, Porsche was also obliged to submit a formal offer to purchase Audi as part of the new shareholder structure.

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Porsche offers to buy Audi

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rybo

— rybo (View Profile)


User Comments

Whelan

Someone needs to explain this to me I guess. VW owns Porsche, Audi, and Lambo right?

So wouldn't this be like Volvo buying Mazda??

— Whelan (View Profile)

Posted on 9/29/2008 12:29:46 PM | reply to this comment | Votes: 1   

AutoEng

Well it is a confusing situation, I'll do my best to explain it as I understand it:

VW owns Audi, Bentley, Bugatti, Lamborghini, Skoda and Seat. Porsche is technically still its own independent company (and much smaller than VW)

However there have long been ties both politically and engineering wise between the Porsche and VW (Toureg/Cayenne).

Also as is common in Germany, there are power families that own huge interests in both Porsche and VW and the heads of these two respective companies are in fact cousins.

What has happened lately is: Porsche has been buying increasing amounts of VW stock. At the time of this article they are up to 35%. In other words its like a whale being eaten by a tuna.

The tiny Porsche company is slowly increasing its holding in VW until presumably they will have a controlling stake or a majority, giving them massive control and influence over the European/Global auto industry.

As part of German law, VW had been protected from this type of buyout for a long time, but with these protections lifted recently by their government, Porsche is poised to take a majority stake.

As part of the rules in Germany, when a Porsche acquires a controlling stake in VW, they must make an offer to buy Audi. Which they did (At a lowball price that VW refused). This is merely a technicality based on the regulations and Porsche has stated they are not interested in separating Audi from the VW group. After all if they have a controlling stake in VW, they will automatically have a controlling interest in Audi anyways.

— AutoEng (View Profile)

Posted on 9/29/2008 12:46:08 PM | | Votes: 8   

204E60

Also, German business law is very different from that of the USA. Companies in Germany are structured under legal programs that are complex and seem strange to Americans. Of course, in Germany it all makes perfect sense.

— 204E60 (View Profile)

Posted on 9/29/2008 1:08:41 PM | | Votes: 3   

B7FAN

I agree who knows who owns who under the VW group

— B7FAN (View Profile)

Posted on 10/1/2008 8:53:18 AM | reply to this comment | Votes: 1   

S4cabriofoxone

Yeah, I don't quite get it either. It would be amazing if Porsche bought Audi off VW, but that's not what's happening.

— S4cabriofoxone (View Profile)

Posted on 9/29/2008 12:31:29 PM | reply to this comment | Votes: -1   

uall

Why would that be amazing?

— uall (View Profile)

Posted on 9/29/2008 1:03:56 PM | reply to this comment | Votes: 0   

S4cabriofoxone

Because Porshce is better than VW, do I really need to spell it out for you?

— S4cabriofoxone (View Profile)

Posted on 9/30/2008 4:34:15 PM | | Votes: 1   

StarSearch

what will amazin do now that Audi will just be a Porsche?

...or will a 911 to him be just a crappy VW? So confusing.

— StarSearch (View Profile)

Posted on 9/29/2008 1:43:19 PM | reply to this comment | Votes: 3   

mini22

However no matter how much stake Porsche has of VW it will not be able to make unilateral decisions without the Lower State Of Saxony which owns 20% of VW. They have indicated that the do not intend to give up there share of VW.If Porsche bought Audi it would not be amazing at all. It would make quite a lot of sense as there is such parts sharing. It is a bit confusing as Audi is 100% owned by VW.So by owning a majority stake in VW they would automatically own a majority stake in Audi.I believe the primary reason that Porsche are buying VW is to 1)ensure it will have continued parts sharing with VW and eliminate any potential take over of VW by anyone else. 2)By VW being a subsidiary of Porsche this will allow POrsche to perhaps factor in overall fuel economy averages and CO2 emmissions requirements to meet the new EU 2012 laws.

— mini22 (View Profile)

Posted on 9/29/2008 1:56:55 PM | reply to this comment | Votes: 4   

mini22

Further it makes Porsche one of the largest auto companies in the world.

— mini22 (View Profile)

Posted on 9/29/2008 1:58:35 PM | reply to this comment | Votes: 5   

Whelan

OK so they are buying the name not necessarily the right to change the models up and such. I think I get the background story now, thanks all!

— Whelan (View Profile)

Posted on 9/29/2008 3:53:10 PM | reply to this comment | Votes: 1   

investor27

But Porsche is not really serious about buying VW group, is it? By law Porsche have to make the offer, but their offer is always at market value and not at a premium and is always turned down by VW three years running.

— investor27 (View Profile)

Posted on 9/29/2008 4:12:30 PM | reply to this comment | Votes: 3   

Denali

good info AutoEng

— Denali (View Profile)

Posted on 9/29/2008 4:43:07 PM | reply to this comment | Votes: 2   

Cornholio852

so porsche owns VW witch owns Audi witch owns Lamborghinni

Right?

— Cornholio852 (View Profile)

Posted on 9/29/2008 5:57:53 PM | reply to this comment | Votes: 4   

IamEvilHomer

yes

— IamEvilHomer (View Profile)

Posted on 9/29/2008 6:20:06 PM | | Votes: 2   

lambo98

wat i thought vw wasnt owned

— lambo98 (View Profile)

Posted on 9/30/2008 12:28:19 AM | reply to this comment | Votes: 1   

StarSearch

...you correcting someone's spelling/grammar??

Pot. Meet. Kettle

— StarSearch (View Profile)

Posted on 9/30/2008 10:09:23 AM | reply to this comment | Votes: 3   

Eyecarehawaii

This will confuse a lot of people. especially those who assume that just because VW owns Audi that Audis must be glorified VWs.

— Eyecarehawaii (View Profile)

Posted on 10/3/2008 5:26:35 PM | reply to this comment | Votes: 1   

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