Porsche, VW Have No Plans To Merge

Porsche sought on Tuesday to allay fears it would force a merger with Volkswagen, a day after setting the stage for obtaining a majority stake in the fellow German automaker.

BERLIN (AP) â€” Porsche AG sought on Tuesday to allay fears it would attempt to force a merger with Volkswagen AG, a day after setting the stage for obtaining a majority stake in the fellow German automaker.
 
In a statement printed in German newspapers and signed by Porsche Chief Executive Wendelin Wiedeking and Financial Officer Holger Haerter, the two executives said ''there will be no merger of the two companies.''
 
''Volkswagen and Porsche will bundle their strengths in clearly defined cooperative projects and implement them to enhance profitability on both sides,'' they wrote.
 
Porsche is Volkswagen's biggest shareholder with a stake of 31 percent. Speculation has swirled for months over when Porsche might move to take a majority stake.
 
On Monday, the supervisory board of Porsche Automobil Holding SE held an extraordinary meeting and authorized Porsche managers to set in motion steps needed to gain regulatory approval for the move, Porsche said.
 
Speculation that Porsche would move to take a majority stake in Volkswagen has been rampant since late last year when the European Court of Justice ruled that Germany's so-called ''VW law'' had illegally shielded Volkswagen from any takeovers.
 
Porsche already had positioned itself as VW's biggest shareholder; and with more than 51 percent between them, the company and the government of Lower Saxony were in a position to block any would-be foreign takeover of Volkswagen.
 
But Porsche has been profiting from its stake in VW, and most analysts thought it would only be a matter of time before it lifted its stake.
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