Porsche Shares Fall As Volkswagen Halts Merger Talks

If Porsche needs additional loans to increase its stake in VW to 75%, it'll have nearly $25b in debt with its effective control of VW. But it will be creating a company as large as GM was. Though a merged Porsche-VW wouldn't operate like GM, it may be regarded as something like the old mega US auto giant.

I would laugh if Porsche ended up not being able to afford the loans/debt it took out/created and ended up collapsing/selling itself to vw before GM collapses.

The Porsche-VW tie-up is a family affair; Porsche’s supervisory board is mostly made up of Porsche family members and VW Chairman Ferdinand Piech is a grandson of Porsche founder Ferdinand Porsche. Its like a new German reality TV show!

Porsche hid behind smoke and mirrors to achieve its 51%. Someone should have been paying attention and asking how does a niche company like Porsche have the capabilities to take over a giant like VW. Now we see that they really can't. Porsche will be merged into VW as VW will find a way to assume Porsche's debt and take over Porsche in return. It is unlikely that it will be VW-Porsche Group if this happens. It may remain as VAG or become a new Auto Union, an interesting name that was brought up considering that at the helm of VW are Audi executives.

Well, if it is a niche company that generates bn 8,5 € income it is possible to take-over such a big company

So, that is why they are now is a dire position?

Porsche has 3 choices. They can either take on an outside partner to help with the debt or they can sell the shares back to VW or do nothing. Right now Piech is holding all the cards due to the economic downturn.Wiedeking will surely leave(if not forced out) if Porsche merges with VW.Provided they are able to handle the interest on the debt Porsche may decide to sit tight for a while until the banks start lending again. It is quite clear that Porsche wants to run VW like it's run Porsche. That apparently will not work for VW. Since Porsche is now in a financial bind they appear to be stuck at the moment.It also seems VW is not interested in Porsche running things especially with Piech in the VW camp.Porsche does not want to be taken over by VW either. The Porsche family may have to eventually take the company private in order to remain independent.

Man, why can't they just play nice and get together, after all, Vdub was brain child of 'ol Ferdinand and Adolf right?