I know the headlines are supposed to pique your interest and get you to read an article, but I didn’t like this headline from News.com.au: “Arabs poised to snap up Porsche”. Brad, one of our PorschePerfect.com readers sent a link to this story over this morning. I have to say, definitely not in love with the idea.
We’ve talked a fair amount here and there about Porsche’s financial dilemma and it appears things are worsening to a point where giving up some control of the company may be inevitable. You need to read the article for yourself (link at the bottom of this post), but the 2 things that stirred up the most for were this:
Qatar has asked for voting shares, a first at Porsche which is wholly controlled by members of the Porsche-Piech families, German media reported.
And this:
Ferdinand Piech, a co-owner of Porsche and former Volkswagen boss, does not have enough backing to turn down Qatar, the weekly says.
Seems like Porsche is over a barrel and ripe for someone to come in and capitalize on the company and their recent investment in VW.
I don’t know enough about the inner workings of the manufacturers to fully understand how this would impact Porsche. Why don’t people weigh in on what they think and what theories they have in the comments.
[Via News.com.au]
http://www.reuters.com/article/innovationNews/idUSTRE55C14W20090613
They are looking for a 25% investment. It looks like Porsche spent a lot of $$$ for VW, but ultimately it was not a great investment since, according to Reuters, their bid to take it over is out and they’ve got $9B in net debt (debt – cash – ST investments) ballpark. I don’t think this deal is all bad. If you look at major companies in the US, nearly all of them are majority owned by external shareholders. It’s amazing that Porsche has been able to remain family-owned up until now. My guess is that Qatar is not going to be granted a lot of power (minority voting rights for starters) as to the direction of Porsche, so we as fans and consumers will not notice any impact. Plus, when you make an investment like that you really aren’t looking to change the brand. If you or I invested in Porsche we wouldn’t want to make it a US brand, likewise Qatar isn’t going to want to make Porsche an Arab brand. That would be an extremely poor move on their part to try to claim any sort of nationalistic ties to Porsche. I think they are doing it for the prestige, and because they feel they can get a good deal in a company with a strong history and future. Again, as fans, we have nothing to worry about.
this is why Porsche is asking the German govt for money – they are trying to take over VW, and don’t have enough capital to exercise their stock options. I’d be surprised if they did a deal w/ Qatar, I think it’s just a bargaining position to get support from Germany
say it ain’t so!family’s done a great job to date.
i wonder what their cost structure is like? it cant be as bad as GM’s, can it?
hope this just a rumor.
I don’t like the sounds of it either and first I think it is someone coming to assumptions before they know what is really going to happen. Second if they mess with Porsche the mess with me… Anyone willing to join me?
@Jeff – Are you suggesting we all pool our piggy bank money together and fund Porsche? If so, count me in!!!
It’s just hard to imagine a ‘Middle Eastern sports car.’ There’s just not the same ring there as ‘German sports car.’
I like this idea about as much i like the idea of our own government running GM.And i DON`T. It makes me think that new control is most certainly going to want to rock the boat and make their ideas known… as human nature is…., And those ideas likely not necessarily in the best interest of the marque!
The idea of Porsche being controlled by family members who have the marques interest first is at risk .
I thought i read at another time that the German govt has the capability to carry Porsche with a loan without a stake . I would like to see that!
we’ll see how this plays out, but even if Qatar gets 25%, it’s not controlling interest, so they’re just another major investor with limited influence and voting power
To me its not about Porsche being “Arab” owned particularly . Its about the input. Will the new owners with such a large stake allow business as usual as far as design and development? Or will they come in and change the soul of Porsche? (we want the cars to look like THIS now) that is my concern. Whether its a Middle eastern company, Italian company, American etc.. not the issue at all to me. Its like the US government involvement now with GM. I get the idea we are going to be told we want to drive cars so small that are like those clown cars in the circus. lol
@Ryan – That is one way we could do it. I would love to own a piece of Porsche. The other would be to let it be known throughout the world that if they change in a negative way, we will band together and not buy anything until they give us what we want.
Personally, I’d rather the US government own a piece of Porsche (in essence, pooling our money Ryan) rather than GM or Chrysler. I believe the investment would have more limited downside with greater potential upside.
I feel slightly more comfortable with an Arab nation owning a piece of Porsche than I did about them buying major US shipping ports, but that hasn’t seemed to be a real problem yet. Do you remember the uproar that caused? Yet they haven’t tried to put their stamp on that other than just passive ownership as far as I know.
I don’t see this as an “arab sports car” move. When UAE invested heavily in Barclays or Saudi Arabia in Citi etc… these companies did not become “arab.” Its simply capitalism at its best. Company needs money, company needs investor. Western investor bankrupt, get Eastern investor. Its simply going after where the money is.
Lets hope Porsche sells more of those boxters and cayennes!!
any updates on this story?hope porsche takes a step back and reconsiders the whole thing.
i think ford should buy porsche. it’s just a thought!
lar, the story is a slow moving one, like a big chess game being played by stoners, but I’m sure something will happen this month
I don’t know about that James. I think Ford would screw up Porsche. Although they are not in bankruptcy like our other two big boys, I don’t think they were far off from joining in. Hopefully they won’t have to do that though.
sarcasm right?
Here is (not much of) an update for you lar. It was posted today. Just explains the deal in more layman’s terms.
Would probably be helpful if I included the link:
http://www.forbes.com/2009/06/17/porsche-qatar-volkswagen-markets-equity-autos.html