Super Street Network

 |   |  Porsche Prepares Sale Of Options
Subscribe to the Free
Newsletter

Porsche Prepares Sale Of Options

Aug 9, 2009

Stuttgart. Porsche Automobile Holding SE, Stuttgart, is in advanced talks on the sale of the cash settled options with respect to Volkswagen shares to one or several investors. Amongst these investors is especially Qatar Holding LLC (QH) with whom talks about an investment in Porsche SE also is underway.

The preparation for the sale of the options on Volkswagen shares leads to a devaluation resulting in a substantial book capital loss. Nevertheless Porsche improves its liquidity situation through the sale of the options structure as it would lead to an inflow of cash in a magnitude of more than one billion Euro, currently serving as cash collateral for the options structure.

Another non-cash relevant book loss derives from the initial full consolidation of Volkswagen group. With the increase of the stake in VW to 50.76 per cent on January 5 2009, Porsche was obliged to fully consolidate Volkswagen. This triggered a so-called Purchase Price Allocation (PPA) under which all assets and liabilities of the part group Volkswagen had to be valued and compared with the price paid for the shares to get to the company's valuation. This results in a substantial negative impact. Overall the two measures should lead to earnings before taxes for fiscal year 2008/09 of up to minus five billion Euro.

It is important that the devaluation of the options and the consequences of the PPA are purely accounting related. They do not affect the valuation of the 50.76 per cent stake in common shares in Volkswagen AG on the Porsche balance sheet.

For Porsche SE, the big advantage in the devaluation of the options lies in the improvement of liquidity available. Furthermore the equity ratio after these steps is still a sound 23 per cent.

BROWSE CARS BY MARKET

MORE FEATURES

Formula D Teams Up with AutoCon To Produce Car Shows for Long Beach and Irwindale Rounds
Matt UlfelderFeb 17, 2017
The Honda Civic Type R will debut at the Geneva Motor Show before entering production later this year.
Kelly PleskotFeb 17, 2017
The Ferrari 812 Superfast boasts the prancing horse brand's most powerful engine yet along with the most ridiculous name yet.
Alex NishimotoFeb 17, 2017
Jaguar has debuted two all-new engines for its XE, XF, and F-PACE lineup, giving customers a wider variety of engine options.
Jonathon KleinFeb 17, 2017
Mercedes-AMG and Cigarette Racing Commemorate 10 years of collaboration with a one-off carbon fiber powerboat sporting 3,100 hp.
Conner GoldenFeb 17, 2017
Sponsored Links

SEARCH ARTICLES BY MAKE/MODEL

Search
CLOSE X
BUYER'S GUIDE
SEE THE ALL NEW
NEWS, REVIEWS & SPECS
TO TOP