• Oct 27th 2010 at 8:00AM
  • Add
Porsche spent billions in an effort to purchase as many Volkswagen shares as possible from 2006 to 2008. But eventually the luxury sports car maker's debt became so overwhelming that it was Volkswagen that ended up in position to snap up it's fellow German automaker. On the surface, that's the end of the story, but Viking Global Investors claims that the tale is a lot more complicated. Business Week reports that the New York-based investment company is suing Porsche for misleading investors to "believe that the VW shares were overvalued, inducing them to enter into short sales of VW shares." The fund lost $390 million in just two days, and short-sellers around the world reportedly lost $38 billion in the same time span.
Nearly $400 million is a lot of money, but it's only one of the short seller suits filed against Porsche. Back in January, several short sellers filed suit with similar claims, as the U.S.-based investors lost over $1 billion on VW short sales.

We aren't at all knowledgeable about the rules of short sales and we don't have any lawyers on the staff, but we can tell you that, at the very least, these lawsuits are likely a big-time hassle for Porsche. And if these suits ultimately bear fruit for the plaintiffs, Porsche could be a very costly problem for a car maker already short on cash.

[Source: Business Week]

I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.

    • 1 Second Ago
  • 2015 Toyota Highlander
    MSRP: $29,765 - $44,140
    2015 Honda Accord
    MSRP: $22,105 - $33,630
    2015 Toyota Corolla
    MSRP: $16,950 - $22,955
    2015 Mazda Mazda3
    MSRP: $16,945 - $25,545
    2015 Jeep Grand Cherokee
    MSRP: $29,995 - $64,895
    Share This Photo X