Bets on Volkswagen AG Killed Broke Billionaire Adolf Merckle
Although he had an estimated fortune of $9.2 billion, he had lost 500 million euros after betting Wolfsburg, Germany-based Volkswagen’s stock would fall and his holding company was already owing banks about 5 billion euros ($6.7 billion).
According to Bloomberg, the 74-year-old businessman threw himself under a train near his hometown, Blaubeuren, on January 5, a police officer reported in an interview. They found his body together with a suicide note on the tracks around 7:30 a-m, about 300 yards from his home.
“His empire was falling apart,” said Stefan Mueller, managing partner at Proprietary Partners AG in Frankfurt. “This was his last desperate act,” he added.
Merckle's holding company owned stakes in HeidelbergCement AG and drug wholesaler Phoenix Pharmahandel AG. His empire included the cement, machinery and drug industries. He had been searching for helpful emergency financing for more than two months from a group of more than 30 banks directed by Commerzbank AG. Deutsche Bank AG, Royal Bank of Scotland Group Plc and Landesbank Baden-Wuerttemberg.
Moreover, Merckle has also asked for a state government bailout, but they refused to help him.
“The dedicated family businessman was broken by his inability to handle the situation and he ended his own life,” his family said in a statement. “The distress at his companies caused by the financial crisis and the resultant uncertainty of the last few weeks contributed to his death,” the family concluded.
However, as VEM said, Merckle's death will have no effect on the restructuring. It seems that he was to receive more than 400 million euros in bridge loans to rescue VEM, Financial Times Deutschland reported.
Still, Merckle might have considered it was not enough for a falling business empire...