WOLFSBURG, Germany (Reuters) - Volkswagen (VOWG_p.DE) aims to integrate sports-car maker Porsche (PSHG_p.DE)(VOWG_p.DE) as soon as possible, although it dampened reports saying a tax-exempt method to complete the transaction has already been found.
“We aim to complete the integrated automotive group as quickly as possible,” Chief Financial Officer Hans Dieter Poetsch told journalists on the sidelines of a ceremony at VW’s headquarters in Wolfsburg, Germany on Tuesday.
Coordination with German tax authorities will continue until “the right time has come” to unveil the terms of an agreement, the CFO said, refusing to speculate when this will be.
Business weekly Wirtschaftswoche reported on Saturday that holding company Porsche SE (PSHG_p.DE) found a way to sell the remaining 50.1 percent of its car-making division to VW without paying an estimated 1.5 billion euros ($1.9 billion) in tax. <ID:L5E8H90OX>
Porsche and VW agreed a merger in August 2009 after the maker of the iconic 911 sports car racked up more than 10 billion euros of debt attempting to buy Europe’s biggest car maker outright.
VW abandoned the merger last September citing unquantifiable legal risks, including lawsuits by short sellers in the United States who claim that Porsche secretly piled up VW shares and later caused investors to lose more than $1 billion.
Both car makers have since been exploring ways to fold the remainder of Porsche’s automotive business into VW, which bought 49.9 percent of the Stuttgart-based manufacturer for 3.9 billion euros in December 2009. Taxes would be payable if VW were to buy the second half of Porsche before August 2014.
“A swifter solution (than 2014) should be entirely in the interest of tax authorities,” said Poetsch. “Swifter solution means higher synergies at an earlier time, higher profits and thus more tax payments.”
Wirtschaftswoche said tax authorities had concluded the deal was legally a restructuring and not a disposal that would require tax payments. Under the restructuring, Porsche’s holding company would receive a single voting share in VW as part of a 4.5 billion euro payment for Porsche’s car-making operations.
A notification published on June 6 by the finance ministry of Baden-Wuerttemberg, the German state that is home to Porsche and fellow car maker Daimler (DAIGn.DE), suggested that Porsche may be able to avoid paying taxes in the event of a restructuring.
Writing by Andreas Cremer; editing by Andre Grenon