It has been years in the making but finally, Volkswagen and Porsche have become one. Made official not too long ago, the two German superpowers will enter into an “integrated automotive group” that is expected to go into effect starting August 1, 2012. More of a “purchase” than a venture, Volkswagen shelled out nearly $5.5 billion for the holding division of the sports car maker (SE) and is now even closer to wholly owning Porsche AG. While VW will benefit from the added expertise of Porsche engineering, the joining isn’t entirely one-sided. Copious amounts of funding as well as refreshing business strategies will soon come to Porsche’s aid.
“We can now cooperate even more closely and jointly leverage new growth opportunities in the high-margin premium segment through targeted investments in pioneering products and technologies,” said Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of Volkswagen Aktiengesellschaft (AG). Under the agreement meet by the two companies, Porsche SE will continue to operate as a holding group in exchange for the mentioned funds. Once the transaction is complete, Porsche SE will give up its 50.1 percent share of Porsche AG. Given that VW already owns the other 49.9 percent, a full-on ownership will soon follow.
“The accelerated integration will allow us to start implementing a joint strategy for Porsche’s automotive business more quickly, to realize key joint projects more rapidly, and hence to leverage additional growth opportunities in attractive market segments,” said Volkswagen CFO Hans Dieter Pötsch.
Source: Volkswagen
