PORSCHE’S FORMER chief executive Wendelin Wiedeking is being investigated by prosecutors as part of an investigation into suspected market manipulation in Volkswagen shares.
The former chief financial officer of German carmaker Porsche, Holger Härter, is also among people being investigated, Porsche said after prosecutors raided its headquarters.
Financial market regulator Bafin said yesterday it had filed charges with Stuttgart prosecutors, adding a legal twist to what has been high corporate drama between the two carmakers.
Porsche confirmed media reports that Mr Wiedeking, Germany’s best-paid executive, and Mr Härter were among targets of the investigation. Neither was immediately available for comment.
Porsche, VW’s majority shareholder, tried in vain to take over Europe’s biggest carmaker. The former chief executive’s actions boosted Porsche’s debt to €10 billion, forcing him to turn to the company’s family owners, the Pieches and Porsches, for capital and to court Qatar for an investment.
In the end, Porsche had to abandon the campaign this year as its debt mounted, forcing it into a reverse takeover by its much larger peer. That cost the jobs of Mr Wiedeking and Mr Härter, whose wizardry with derivatives helped Porsche mount the daring raid on Volkswagen.
As part of the takeover, Porsche moved to seize control of more than 70 per cent of Volkswagen’s stock, causing Volkswagen ordinary shares to shoot up to €1,000 apiece last year, briefly making it the world’s most valuable company.
Porsche said Stuttgart prosecutors had searched its offices and seized documents as part of a probe into suspected disclosure violations and market manipulation.
A spokeswoman for the prosecutors office said authorities were also looking into whether inside information had leaked out. She did not identify any suspects in the investigation.
A source close to the investigation said private homes were also searched and that a another “handful” of people were targets of the investigation, including advisers.
“Porsche rejects the accusations that have been raised,” the company said, adding it was co- operating fully with authorities.
Bafin declined to comment on whether specific individuals were being investigated or on the exact period under investigation.
The regulator said in May that it had started an investigation into possible market manipulation by Porsche linked to its attempt to take over Volkswagen.
That case centred on a report by WirtschaftsWochemagazine that alleged Porsche had revealed in February 2008 its intentions to take a 75 per cent voting stake in Volkswagen and pass a domination and profit transfer agreement, but did not make this public at the time.
Porsche denied the report at the time.
“Porsche decided on March 3rd, 2008, to acquire the majority of voting shares in VW. There was no intention at that time for Porsche to raise its stake to 75 per cent of the votes,” Porsche said in a statement then. – (Reuters)
