Showdown at Porsche Corral

As those who have followed the Porsche-Piech soaps know, there will be an extraordinary meeting of the Porsche supervisory board next week on July 23. On the agenda: “Will we be saved by the Sheik of Qatar, or by the Sheik of Wolfsburg, or all of the above?” Any guesses?

Wendelin Wiedeking prefers the Qatar version, it would bring more job security for Wendy. He better update his resume: Today, it is being leaked all over the place that Porsche will be scooped up by Volkswagen. Reuters has it that “the owners of indebted automotive group Porsche SE have agreed in principle to accept Volkswagen’s plan for a merger but the deal awaits final approval.” The approval may come at the board meeting next week.

Die Welt reports that Porsche is ready for a merger with Volkswagen. “As a first step, Volkswagen will take over 49.9 percent of Porsche,” the paper writes.

Financial Times has similar news: Their sources said “the combination of a sale of half the sports car business for as much as €4bn to Volkswagen, a €5bn capital raising and the sale of options that can be converted into VW shares was seen as a possible solution to the debt problems.” Porsche’s debt has climbed from €9B to more than €10B ($14B).

How the first step of the deal may look is illustrated by a chart, courtesy of Financial Times Deutschland. It’s in German, but it speaks for itself. Katar = Qatar. Niedersachsen = Lower Saxony. Neu = new.

After acquiring just under half of the Porsche group’s healthy Porsche AG sports car business, Volkswagen would eventually take over all of Porsche AG, adding a 10th brand to its lineup, the reports say.

It just so happens that the Volkswagen supervisory board also has an extraordinary meeting, also on July 23. Coincidence of the coincidences: The Volkswagen board meeting is taking place in Stuttgart. This is unusual in many ways: Security-conscious Piech usually doesn’t publish these meetings beforehand. Board members usually receive the location at the last minute. And a meeting in Stuttgart, home of Daimler and Porsche? There must be extraordinary reasons for two extraordinary board meetings in the same town: Piech is Chairman of the Volkswagen supervisory board. He’s also a member of the Porsche supervisory board. With both meetings in the same town, it’s less of a commute. And the VW board can ratify the Porsche deal immediately, if it is accepted.

Rumors are making the rounds in Deutschland that Ferdinand Piech, his brother Hans Michel Piech (a Porsche board member just like Ferdi) and their cousin Wolfgang Porsche (chairman) had a little sit-down, and it’s all hashed-out en famille. The families are contractually obliged to vote together on strategic issues.

Whither Wendelin Wiedeking? He “is preparing for his departure as the automaker’s family owners are set to agree on a compromise that will let Volkswagen AG take a 49 percent stake in Porsche,” Bloomberg says. Financial Times Deutschland says Wiedeking already hired a prominent Stuttgart lawyer as “an advisor.” Most likely, as the designer of a platinum parachute for the world’s highest paid automotive CEO.

Asked to comment by Das Autohaus, a Porsche spokesman only had a mamby-pamby “we have no information about an agreement.” Asked about Wiedekind, the flak said: “He is in charge and will stay in charge.” Didn’t say for how long.