Europe’s biggest automaker Volkswagen is to wrap up its takeover of German luxury sports car group Porsche two years earlier than planned in order to unlock hitherto untapped economies of scale.
In a statement, the two companies — which have been seeking to merge since 2009 — said they had found a way to integrate their two businesses “some two years earlier than would have been economically feasible” under their previous plans.
Under the deal, which they said would unlock 320 million euros ($400 million) in net synergies, VW is to pay Porsche’s current holding company Porsche SE 4.46 billion euros plus one VW share for the 50.1% it does not already own in the sports car maker.
VW initially acquired 49.9% in Porsche in 2009 in the first stage of a complex takeover agreement, the completion of which has since run into a number of legal and tax hurdles.
Prior to VW's takeover of Porsche, the sports car maker had itself tried, but failed, to swallow the much larger VW, running up more than 10 billion euros of debt in the process. VW’s chief executive Martin Winterkorn said the accelerated merger deal would benefit customers, employees and shareholders alike.