When the takeover battle between Porsche and VW ended, VW won a profitable subsidiary.
The Stuttgart public prosecutor has dropped its appeal against a not guilty verdict of the Regional Court of Stuttgart where former members of the executive board of Porsche Automobil Holding SE, Dr. Wendelin Wiedeking and Holger Härter, were acquitted of misleading statements. Also, the Stuttgart public prosecutor’s motion for imposing a fine against Porsche SE as a secondary party of the criminal proceedings has been rejected.
Back in March 2008, then independent Porsche SE dismissed as “speculation” rumors saying it was going to take over Volkswagen Group. In October of 2008 Porsche admitted it controlled 42.6 % of VW’s common shares and held options for another 31.5 % that it had not disclosed.
Porsche’s attempt to take over Volkswagen Group, ironically, ultimately resulted in exactly the opposite with Volkswagen Group swallowing the performance vehicle maker whole when the leveraged funds of the pursuer ran into the brick wall of the Great Recession and margin calls in 2009. Porsche remains VW’s largest stockholder, though.
This ends a long, international soap opera of litigation that also saw U.S. hedge funds sue Porsche over alleged market manipulation while acquiring Volkswagen stock. The American plaintiffs asserted claims against Porsche SE under the U.S. securities laws and common law arising out of Porsche SE’s acquisition of and disclosures regarding Volkswagen ordinary shares in 2008. They lost, too.
“The allegations made by the Stuttgart public prosecutor have been proved to be completely unfounded during the extensive taking of evidence conducted by the Regional Court of Stuttgart,” said Manfred Döss, member of the Porsche SE executive board responsible for legal affairs. “We welcome the decision of the public prosecutor to accept the verdict.”
Porsche said that on 18 March 2016 “the Regional Court of Stuttgart found the two former members of the executive board of Porsche SE not guilty of alleged information-based market manipulation concerning all charges. According to the opinion of the chamber under Presiding Judge Dr. Frank Maurer, the six indicted statements made in the period from 10 March 2008 to 26 October 2008 were neither false, nor misleading or deceitful in any other way. Furthermore, it had not been proven that the six accused statements actually influenced the stock-market price of Volkswagen ordinary shares and that they were even suitable to influence the Volkswagen share’s stock-market price.”
See:
- Court of Appeals Rules against Hedge Funds in Porsche Caper
- Volkswagen Takeover of Porsche Stalled, Legal Problems Cited
During the first six months of 2016, Dr. Ing h.c. F. Porsche AG increased its operating profit – by 8% to €1.8 billion. Deliveries rose by 3% to 117,963 vehicles, while sales increased by 1% to €10.9 billion. Return on sales at 16.8%, compared with 15.6% during the first six months of 2015. The number of employees rose by 12% to a total of 26,191. “Enthusiastic customers, secure jobs and an attractive return on sales are more important to us than production volumes,” said the Deputy Chairman of the Executive Board and Member of the Executive Board responsible for Finance and IT, Lutz Meschke.