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Porsche and Piech families seek driving seat at Volkswagen - sources

Stock Markets Aug 08, 2022 05:41
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© Reuters. FILE PHOTO: Electric car models of the Volkswagen Group Volkswagen ID.3, Seat Cupra Born, Volkswagen ID.4, Audi Q4 e-tron, Volkswagen ID.5 GTX and Audi Q4 Sportback e-tron are parked outside the production plant of Volkswagen, in Zwickau, Germany, April 2
 
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By Jan Schwartz

HAMBURG (Reuters) - Volkswagen (ETR:VOWG_p)'s controlling shareholder families aim to keep Europe's top carmaker on a shorter leash and want greater say over strategic matters in what marks a power play ahead of the planned listing of Porsche, people familiar with the matter say.

The Porsche and Piech families, who control holding firm Porsche SE - which owns most of Volkswagen's voting rights - are hoping to return the group to calmer waters after a turbulent period under outgoing CEO Herbert Diess, they added.

"They want to keep a closer eye on the implementation of the strategic guidelines," a person with knowledge of the families' thinking told Reuters.

Under Diess, Volkswagen made major steps towards electrification, but his forthright style provoked opposition within the company that sometimes eclipsed his achievements, testing the families' patience, the sources said.

As a result, they plan to run a tighter ship.

"The families are actively involved - an ability they have long been believed incapable of," a second source said.

The greater influence has already been reflected in the appointment of Oliver Blume as Volkswagen's next CEO, a move that has drawn fire from several investors because he will also stay boss of Porsche AG - even after a planned flotation.

Touted as the "preferred candidate" of the Porsche and Piech clan, Blume is expected to push through the long-awaited initial public offering (IPO) of Porsche AG, the families' namesake carmaker he has been leading since 2015, the people said.

Porsche SE and Volkswagen declined to comment.

The IPO is critical to the families as they would become a direct shareholder of Porsche AG again after the maker of the iconic 911 model was taken over by Volkswagen in 2009, following a botched attempt by Porsche AG to buy Volkswagen instead.

"The structure of the IPO primarily fulfils the families' interest in further tightening their grip on Porsche, and they will not be dissuaded from this plan," said Hendrik Schmidt, corporate governance expert at DWS, which holds shares in both Volkswagen and Porsche SE.

The agreed structure of the IPO, which has still to be confirmed, would give the Porsche and Piech families a blocking minority in the sports car brand that was founded by their ancestor Ferdinand Porsche in 1931.

Manuel Theisen, retired professor for business administration at Ludwig-Maximilians-University Munich and a specialist in corporate governance, said this was a way to claw back some of the families' influence.

"The primary reason is power."

Porsche and Piech families seek driving seat at Volkswagen - sources
 

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