Porsche say they will take control of VW by boosting their stake in the German automaker from 31% to over 50% as soon as antitrust authorities approve the $15.2b deal. Porsche won’t merge operations with VW, which will instead become a separate unit of the holding company, but the two units will collaborate closely on development of vehicles and technology.
At the same time, VW will spend nearly $4.4 b to boost their voting rights in Swedish truck maker Scania AB to 69%. VW also own 29.9% of German truck maker MAN, who own a separate 17% stake in Scania. Although there is no immediate plan to merge Scania with MAN, analysts expect VW to eventually oversee a three-way alliance of the two companies and its own commercial truck operations. That entity could become the biggest player in Europe’s commercial truck market, where VW have trailed Daimler AG and AB Volvo. Daimler would still lead in worldwide sales.
MAN’s $13b hostile bid for Scania collapsed in early 2007. Since then, VW have tried unsuccessfully to broker a friendly MAN-Scania merger that would include at least some of VW’s commercial truck business. VW say they don’t plan to buy the rest of Scania or change its management. Analysts describe the Porsche-VW deal as a triumph for Ferdinand Piech, VW chairman and a major Porsche shareholder. His grandfather, Ferdinand Porsche, founded both companies.