When Wolfgang Porsche learned that his family’s sports car company would need an emergency cash infusion from its giant rival Volkswagen, he “went absolutely white.”
on March 23, fax machines around Germany spit out papers for Volkswagen’s board members to sign: an emergency loan of 700 million euros from Volkswagen, about $950 million at the time.
“This is becoming a reverse takeover on a financial level,” said Arndt Ellinghorst, head of automotive research at Credit Suisse in London. “Porsche has debt and VW has the luxury of cash.”
Even amid the tumult that is the car industry these days, the story of Porsche and its overreaching ruling family is a singular drama. Its denouement was most likely prompted by Porsche’s taking out billions of euros in loans to acquire the last portion of Volkswagen that it did not own, enlarging its debt load at precisely the moment capital markets froze up.
At heart, though, the role reversal — where Porsche turned from Volkswagen’s predator to its prey — is the latest scene in a family saga.
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