assimilation merger with Volkswagen has hit a snag, temporarily halting negotiations. We're told the "snag" is who's going to lead the new company — VW CEO Martin Winterkorn or Porsche CEO Wendelin Wiedeking.
Although Porsche declined to comment, we're told the one key sticking point revolves around who would lead the new company. There has been mounting pressure to name Volkswagen's CEO, Martin Winterkorn, the leader of the merged company, a move which likely doesn't sit well with Porsche.
Ferdinand K. Piëch, the VW chairman, last week offered a vision of a combined company in which Volkswagen would be in control - based in Wolfsburg, like Volkswagen, with Martin Winterkorn, the VW chief executive, holding that role in the new company. He also warned that Porsche would have to get its debt under control before a deal could be completed.
Porsche, with a market value of 7.2 billion euros, is dwarfed by VW, which has a value of 69.6 billion euros. Porsche holds 50.76 percent of Volkswagen shares. It also has said it holds options giving it the right to acquire a total of about 75 percent.
Probably not helping negotiations may be the relations of the controlling families. Ferdinand K. Piëch is chairman of VW, and his cousin Wolfgang Porsche heads the Porsche board. Ain't nothing but a family thing. [via NYT]
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