Outgoing CEO of German car manufacturer Porsche, Wendelin Wiedeking (2nd L) waves goodbye to Porsche employees after he gave a farewell statement beside his successor Michael Macht (L-R), outgoing CFO Holger Herter and Wolfgang Porsche, chairman of the supervisory board of Porsche during an employee meeting at the Porsche headquarters in Stuttgart, July 23, 2009.
Former Porsche CEO Wendelin Wiedeking and his brother-in-arms, finance chief Holger Haerter, announced their abrupt resignation this morning after concluding a marathon board meeting late last night. CEO since 1992, Wiedeking’s accomplishments within Porsche have been eclipsed as of late by his failed attempt to buy out Volkswagen. In ways the corporate world deemed underhanded, Wiedeking orchestrated the purchase of 51% controlling stake in Volkswagen, setting Porsche back a cool $12 million. The move was considered controversial at best and came under fire when Volkswagen posted an annual profit of $162 billion, roughly 16 times greater than Porsche’s reported $9 billion.
With Porsche’s balance sheets askew, Porsche Automobil SE (the holding company) moved to sell off stake in Porsche AG (the manufacturer) to Volkswagen in order to pay off debt, but Wiedeking blocked the transaction. Wiedeking continued to resist what would essentially be a merger between the two companies, despite Porsche’s deteriorating financial health, and negotiations between the two companies sat at a stalemate.
Today’s announcement of Wiedeking’s surrender marks a definite win for Volkswagen, indicating that Porsche will most likely become VW’s 10th subsidiary before the year is finished.
Source: The Wall Street Journal
Image Cred: Reuters Pictures