Porsche Increases Its Majority Stake in Volkswagen

Porsche, the most profitable vehicle brand on a per-sale basis, is also doing fairly well overall. In fact, continuing on where

we left off last March when we reported that the sports car (and SUV) company had been given the go-ahead from Volkswagen's board to increase its stake in the Wolfsburg-based automaker, it has now completed the transaction which adds a further 4.89 percent of Volkswagen ordinary shares for a total of 35.14 percent of the voting rights, making the Stuttgart-based company a majority shareholder and giving them de facto control of the company.

The move will give Porsche more say in day to day operations, and while running a premium sports car maker like Porsche is no doubt different than returning Volkswagen and its many brands to profitability, the iconic car maker at least has a successful track record to draw upon. Volkswagen currently owns numerous nameplates,

from entry level brands like the Czech Republic's Skoda and Spain's Seat, to upper-echelon marques like Bentley and Bugatti. It also owns Audi AG, which owns supercar maker Lamborghini, so in effect Porsche owns a controlling stake in all said nameplates.

The final move will be for Porsche to submit a formal offer to Audi AG in Ingolstadt, as required by law due to the unique shareholder structure between the two companies, so that the deal can be ratified. As noted, this is a formal offer and doesn't stand any chance of rejection, nor does Porsche plan to modify its relationship with Audi.

Although Porsche is now securely at the helm, it is not expected that any major changes will be made to either VW or Audi's executive team or overall global strategy, at least not in the short term. After all, Stuttgart has been assisting Wolfsburg in restructuring for some time now, having enjoyed significant influence within, and therefore should be satisfied with directions taken and the team leading operations.