Commentaries
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VW prefs don’t deserve DAX treatment
Volkswagen’s merger with Porsche has exposed a bizzare quirk in the Deutsche Boerse’s index requirements, which could allow the carmaker’s preference shares to replace its ordinaries in the flagship DAX equity index.
Preference shares have no place in blue-chip equity indices. Their dividends must be paid before any distribution to ordinary shareholders, but they have no right to anything further, often lack voting rights, and escape most of the disclosure requirements imposed on ordinary shareholders.
 The latest twist in the VW/Porsche road trip is Qatar’s sale of half of some 50 million VW preference shares it has accumulated. It is concentrating its investment on VW’s ordinary shares, where it is aiming to achieve a holding of 17 percent.
This will mean more than 90 percent of VW’s voting shares will be held by the Porsche clan, the state of Lower Saxony and the Qataris. With a free float of less than 10 percent, the ordinary shares will no longer qualify for DAX inclusion.
Qatar will need to keep driving Porsche hard
It has taken a long time, but the Porsche clan is finally — and no doubt reluctantly — giving outsiders a say in how it runs the family firm.
The Porsche and Piech families — the descendents of Ferdinand Porsche –are selling a 10 percent voting stake in the Porsche holding company to Qatar in order to get them out of the financial mess they found themselves in when Porsche tried an audacious takeover of Volkswagen.
Porsche prepares to enter Auto Union with VW
It’s been a tortuous road, but Porsche looks as though it might finally have struck a deal with VW and Qatar to sort out its debt problems.
A Reuters report says that details of a deal between Volkswagen and Porsche have been broadly agreed, with VW set to buy a stake of up to 49 percent in the sportscar maker. The Porsche marque will then enter into a new “Auto Union” as the 10th brand, under the leadership of VW CEO Martin Winterkorn.
Porsche’s VW options not for the faint-hearted
Porsche may own a lot of options on Volkswagen - around 20 percent of the larger carmaker’s shares – but the sports car maker is running out of alternatives to solve the financing problems it built up by acquiring a 51 percent stake in VW.
Despite a recent report of other investors being interested in relieving it of the options, Porsche insists that talks with Qatar remain exclusive.
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The Wall
