On Wednesday, the long awaited deal between two auto majors Volkswagen and Porsche finally came into effect. This Integrated Automotive Group deal was announced in July 4th but was signed and sealed on August 1st, 2012. Under these terms and conditions Porsche will contribute 50.1% of its business to Volkswagen for €4.49 in addition to 1 VW ordinary share. On the close of the deal, VW will hold 100% shares of Porsche AG through an intermediate holding company.
A cash and share consideration of €4.49 billion is based on equity value of €3.88 billion for remaining Porsche shares. Under the terms of the Comprehensive Agreement, Porsche SE will receive remuneration for dividend paid from indirect share in Porsche AG besides 50% of the present value of net synergies realizable through this integration which will amount to €320 million.
Accelerated integration will allow both companies to commence implementing a joint strategy for Porsche automotive business quicker. Besides this key joint projects will be realized faster and help to leverage additional business growth opportunities in enhanced market segments. Day to day business cooperation between the two auto companies will also be improved through this joint agreement.
No comments:
Post a Comment