Plans by Porsche to take full control of Volkswagen have drawn closer with a recent ruling from the European Commission declaring “the transaction would not significantly impede effective competition”. Although, the deal is not sealed yet.
The German government and the state of Lower Saxony have laws in place that preclude any full takeover of Volkswagen, however, this ruling seems to be on borrowed time with the European Commission willing to take the matter before an EU court if need be. The Commission believes competition will not suffer if Porsche achieves its ultimate aim stating, “The commission’s examination of the transaction showed that horizontal overlaps between Volkswagen and Porsche are limited and that, for all car segments concerned, Porsche will continue to face several strong, effective competitors”.
Porsche has previously stated it wants to increase its stake in Volkswagen to 36 per cent by this September, which would give them strong influence over Volkswagen’s manufacturing decisions. Once the green light has been given from competition regulators Porsche will look to take a controlling interest by lifting its stake over 50 per cent.
Source: Deutsche Welle
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