The reunion of the Porsche and Piëch families must have been no picnic. The two cousins Wolfgang Porsche, chairman of Porsche, and Ferdinand Piëch, chairman of Volkswagen have already clashed over how to bail out Porsche before and their disagreements are likely to continue.
The Porsche clan, which owns a larger piece of Porsche than the Piëch clan, was backing the plan of Porsche CEO Wendelin Wiedeking to merge VW and Porsche into a new holding company and to inject capital from the families and outside investors. People close to the situation told the Financial Times that several sovereign wealth investors from the Middle East had expressed interest in investing in a combined VW / Porsche group. However, the Piëch Clan had an alternative proposal for VW: a takeover of Porsche AG. This plan would have turned upside down Porsche’s takeover strategies for VW, which had been pushed forward by a respective decision of the European Court of Justice in 2008, which declared invalid the minority blocking rights of shareholder Lower Saxony.
After the family reunion on Thursday, Volkswagen and Porsche announced that they would conclude a merger which would turn Europe’s largest carmaker into a family-controlled company. The move, which must still be approved by all of VW’s shareholders and the companies’ powerful works councils, would add Porsche to the other VW brands while the independence of all brands would be ensured. A taskforce of Porsche and VW managers, works council representatives from both companies and the state of Lower Saxony will now work out the final details of the new company structure within the next four weeks.