Porsche reportedly closing in on Qatar investment deal
Porsche 911 Carrera 4S in the Autoblog Garage – Click above for high-res image galleryIt's a match made in heaven: Porsche needs money, Qatar has tons of it. Any questions?
Following deals that have seen Kuwaiti firms take control of Aston Martin and Abu Dhabi investing in Daimler and Ferrari, Porsche is reportedly closing in on a deal that would see the Qatar state government help Porsche pull itself out of debt and regroup for its planned take-over of the Volkswagen auto empire. The once cash-flushed sportscar-maker is in the process of refinancing its debt to the tune of 12.5 billion euros, but with 10.75 billion already raised, a request pending for another 1.75 billion from the German federal government and an anticipated additional billion in revenues anticipated this year, Porsche is still eager to bring in more capital.
Although previous reports suggested the deal would involve the Qatar state government buying stake in Porsche, that was before Stuttgart and Wolfsburg began discussions of convoluted mergers. Two options are subsequently reported to now be on the table: Qatar could either buy stake in Porsche Automobil Holding SE (which owns both Porsche's automaking unit and its 51% stake in VW), or alternatively buy up Porsche's outstanding option on 24% stake in Volkswagen, thereby giving Stuttgart a partner and Wolfsburg a new power-player.
[Source: Automotive News Europe – Sub. Req.]
Reader Comments (Page 1 of 2)
Spiel 7:47AM (6/09/2009)
So it's safe to safe in a couple of years all auto companies will be owned by countries in Asia?
Sad...yet funny.
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Shawn 8:13AM (6/09/2009)
Qatar is in the Middle East...
Spiel 8:23AM (6/09/2009)
Son of a .....I never knew the Middle East was its own continent. All this time these damn books taught us it was part of Asia.
Redeemed 8:35AM (6/09/2009)
"So it's safe to safe in a couple of years all auto companies will be owned by countries in Asia?"
Are you related to the jr. Miss South Carolina? Sorry, couldn't resist.
Shawn 8:40AM (6/09/2009)
Sorry, we don't call the people of the Middle East Asians here. I guess you do where you are at.
tankd0g 9:18AM (6/09/2009)
Please don't call Canadians, "Americans" either.
Kei 6:44AM (6/26/2009)
Lol Spiel.
Qatar's actually considered one of the safest countries in the world http://www.iloveqatar.net
Motor_Yakuza 8:20AM (6/09/2009)
I almost want to get an Insight when I see how much money this rug heads are making from us.
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Sea Urchin 8:27AM (6/09/2009)
So we are OK with Qutary government owning a car company, but not with US Government?
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The Other Bob 9:10AM (6/09/2009)
Exactly!
Everyone here is crying socialim all the while every other country is far more socialist, even when not in a crisis.
Motor_Yakuza 9:14AM (6/09/2009)
Nobody cares about Qatar gov, they broke to many laws of common sense already.
tankd0g 9:19AM (6/09/2009)
Yes, there's no difference between investing in a highly profitable business for financial gain and pissing tax payer dollars down a bottomless hole.
BoxerFanatic 11:27AM (6/09/2009)
tankdog is right.
Qatar likely has stacks and stacks of cash, without taxing it away from it's people, while it deficit spends at insane levels.
They are buying debt. Like BONDS. Like the state of Indiana buying Chrysler Bonds, that the US Government is tearing asunder by obliterating contract and bankruptcy law precedents. Remember that when they ask Sotomayor about the precedence of Law. The US government couldn't care less about precedence and rule of law.
The Qatar government investors are not seeking control of the company they are lending to. They are not ousting CEOs. They seem to only be seeking interest on their cash, by lending it to a corporation, for a return. Like, an economic market.
If you think that is the same thing that the US Government is doing with GM and Chrysler, you are a lunatic.
madgamer 7:15PM (6/09/2009)
It's not just likely that they have stacks of cash, they DO have them. The government in Qatar makes over a billion $ per DAY, mostly from oil. If the foreign governments would let them, they could just buy many of these companies outright.
Kei 6:46AM (6/26/2009)
@madgamer, Qatar's major focus is in Liquified Natural Gas :)
Cougs 8:33AM (6/09/2009)
As long as every 1 in 15000 porsches is gold plated, we have a deal!
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Jake 8:35AM (6/09/2009)
Ok, car companies goes into tremendous debt with acquisitions, instead of focusing on its brand. Then goes through elaborate schemes to refinance its increasing burden of debt. ....
How does this story end?
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Redeemed 8:58AM (6/09/2009)
You cannot compare the two countries. Qatar is not a democracy - they are a monarchy. Their ruling family can call the shots.
Also, Qatar is not in the poor house like our debt ridden country. They are smart to divest themselves out of oil and into many other holdings while they still have the chance.
And most importantly, the purchases by the Qatar government are just that, purchases. They are not takeovers like in the USA where, despite objections by the majority of citizens, the government chooses to spend at a level that will cripple this country down the road for decades to come. Takeovers which also violate the laws of this land and put this administration's party supporters (UAW) ahead of bondholders who rightfully deserve first shot at being paid back.
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Motor_Yakuza 9:15AM (6/09/2009)
Nope, they are lucky enough to stay on an ocean of oil, like other middle eastern crappy countries.
BoxerFanatic 11:30AM (6/09/2009)
The US is sitting on land full of oil, shale, coal, and natural gas. Not to mention the ability to build nuclear reactors to generate power.
Yet we aren't using those resources. Qatar is not to blame for that. They use their resources, and do their business. They have their issues, but the US certainly has ours.