Word: mergerism
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...Though details are still unclear, the plan appears to place the individual brands under the umbrella of a kind of holding company, described in a statement by Porsche as an "integrated leading company." The merger also entails a $6.7 billion capital increase, financed by Porsche's existing shareholders, for the new company this year or next, according to a Reuters report...
...Analysts say the deal seems to fall short of a full merger. It appears that Porsche's car-making unit will not be sold to VW, but will retain some independence. And the rights issue will be dilutive to earnings because profit will be distributed among a larger number of shares. The uncertainty about the structure of the deal was fueled by comments from Bernd Osterloh, head of VW's works council, who said the two companies may not merge at all. (See pictures...
...appears that the terms merger and integration are being used interchangeably here. And, because of VW's bylaws alone, we are more than skeptical that the way for a merger can be made clear at all," he said at a conference in Wolfsburg on Thursday...
...This deal seems to be yet another sign of how hard the global automotive industry has been hit by the recession. The news of the Porsche-VW merger follows the announcement earlier this week by Italian carmaker Fiat that it wants to acquire U.S. automaker Chrysler, which the U.S. government forced into bankruptcy protection last week, and GM Europe. Fiat wants to merge with Chrysler and GM's Opel to create one of the largest car companies in the world. (See Chrysler's top ten moments...
...written just for VW, the so-called "Lex VW," the state cannot be outvoted. Lower Saxony's governor, Christian Wulff, a Christian Democrat who sits on the VW supervisory board, opposed a takeover of the company by Porsche. So it was no surprise that Wulff welcomed the merger announcement...