VW Shareholders Approve Capital Increase

A major obstacle in the path of acquiring a large portion of Porsche has been overcome yesterday by Volkswagen, as its shareholders approved the Supervisory Board and the Board of Management proposition to issue a maximum of 135 million new non-voting preferred bearer shares.

This means Volkswagen has a green light to increase its capital in early 2010 and move one step closer to the merger with Porsche.

"The combination of Volkswagen and Porsche to form a group with ten strong brands follows a compelling strategic, industrial and financial logic. The integrated group will realize significant additional growth potential going forward. In the long term, the integration of Porsche will also lead to higher profits for the new group and create added value for Volkswagen shareholders," Porsche says in a release.

The next step is the acquisition of a 49.9 percent stake in Porsche. Volkswagen says this may happen as soon as next week, with the acquisition of the trading business of Porsche Holding Salzburg to follow in 2011. The merger is to be concluded the same year.

Additionally, the shareholders approved the appointment of two members from the State of Lower Saxony in the Supervisory Board, for as long as the German state holds 15 percent of VW.

Hans Michel Piech and Ferdinand Porsche, the two men appointed back in August to replace Wendelin Wiedeking and Holger P. Harter, have also been confirmed as board members for a full term of office.