Porsche stake in VW unlikely to change soon; a new "VW law" could return
The so-called "VW law" was struck down by the European Court last October. Previous to that, the state of Lower Saxony was able to veto any Volkswagen shareholder action it didn't like. When the law was struck down it looked like the Lower Saxony had no choice but to watch Porsche, which had been circling shark-like around Volkswagen for a bit, decide on the day it chose to take majority control of the much larger company.
But Lower Saxony had a much bigger shark on its side in the form of the government in Berlin. Politicos in the German capital have been drafting a law that would "replace" the "Volkswagen law" and put Lower Saxony, with its 20.1-percent holding in VW, back in effective control of the company. The law still has hurdles to overcome, such as approval by the German parliament and then approval by the EU. Frankly, we don't see how the EU could approve the law if it artificially inflates the state's position over that of a shareholder. Porsche is going to wait for the law, and elections in Lower Saxony, to run their courses before proceeding with its efforts to take a majority stake. Der Saga continues.
[Source: Automotive News - Sub. Req.]
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Print | posted on Wednesday, January 30, 2008 3:08 PM