UPDATE: Porsche SE Considers Strategic Investments In Car Industry
11 May 2012 - 12:25AM
Dow Jones News
Porsche Automobil Holding SE (PAH3.XE) wants to plow the
proceeds from the planned sale of its sports-car division to
Volkswagen AG (VOW.XE) into investment in other automotive assets
after it has paid back its remaining bank debt.
"The proceeds should mainly be used for further investments
focusing on the automotive value chain," Porsche said Thursday in
the agenda for its shareholder meeting published on the corporate
website.
Porsche said it will adjust its corporate statutes to reflect a
broader investment brief at the meeting scheduled for June 25.
A spokesman for Porsche said this was a precautionary move to
keep all strategic options open for the time after the integration
of Porsche's sports-car operation into Volkswagen has been
completed. There are no concrete plans for outright acquisitions,
he said.
Porsche sold a 49.9% stake in its sports-car unit to Volkswagen
in 2009 as part of a complex deal to forge a combined company after
its attempt to take over its much larger rival backfired amid
ballooning debt in the aftermath of the financial crisis.
At the time, Porsche and Volkswagen mutually granted each other
options to transfer the remaining 50.1% stake to Volkswagen if the
initial plan for a merger including Porsche's holding firm doesn't
work out. This initial plan was abandoned last year due to legal
obstacles.
The sale of the remaining 50.1% stake in Porsche's sportscar
unit is expected to be worth roughly EUR4 billion, substantially
more than Porsche Holding's financial liabilities of EUR1.5 billion
at the end of the first quarter.
Paying back the remaining debt would mark a turning point for
Porsche's holding firm after it almost collapsed in 2009 under more
than EUR10 billion in debt. Porsche's highly-leveraged and
ultimately unsuccessful takeover of Volkswagen proved one of the
most spectacular corporate maneuvers in recent years in Europe.
Porsche's holding firm, which is controlled by the Porsche and
Piech families, ended up with a 50.7% voting stake in Volkswagen
which forced out the Porsche management. Porsche's owner families
agreed to a new merger deal under Volkswagen's leadership.
The timeframe for selling the Porsche sportscar unit, however,
remains uncertain as both companies are still looking into possible
alternatives to speed up the integration into Volkswagen's stable
of eleven car, truck and motorbike brands.
Porsche's holding firm can exercise the put option to sell the
remaining 50.1% of its sports car business, held through a company
called Zwischenholding GmbH, between Nov. 15, 2012, and Jan. 14,
2013, or between Dec. 1, 2014, and Jan. 31, 2015.
Volkswagen can exercise the respective call option to buy the
remaining 50.1% stake in Zwischenholding between March 1, 2013 and
April 30, 2013, or between Aug. 1, 2014 and Sept. 30, 2014.
A key aspect of the evaluation is a potential tax charge of
about EUR1 billion if Volkswagen and Porsche go ahead with the deal
before mid-2014. But concluding the deal earlier would enable
Volkswagen and Porsche to extract cost savings faster.
Porsche's preferred stock, its only traded securities, were 1.3%
lower at EUR43.81 around 1345 GMT Thursday on the Frankfurt stock
exchange.
-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512;
christoph.rauwald@dowjones.com
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