Thursday April 24, 11:11 AM
VW director backs Porsche takeover as trade union protests
HAMBURG, Germany (AFP) - The head of Volkswagen (Xetra: 766400 - news) , Martin Winterkorn, addressed a general assembly of VW shareholders Thursday to defend an eventual takeover by the sports car maker Porsche (Xetra: 693773 - news) despite union protests.
"We are pleased that Porsche has said it wants to take a majority holding in Volkswagen," the biggest European carmaker, Winterkorn told around 4,000 investors in this northern port.
"With Porsche and the regional state of Lower Saxony, Volkswagen stands on a solid foundation," the VW chairman added, even though the company's two biggest shareholders were battling intensely for influence over the group.
Porsche owns 31 percent of VW, and the state where VW is based owns just over 20 percent. They strongly oppose certain statutes and a so-called VW Law which gives Lower Saxony a virtual veto over strategic decisions such as plant relocations.
A meeting of the VW supervisory board on Wednesday failed to come up with a compromise position, company sources said.
Lower Saxony got backing on Thursday from the German trade union IG Metall, which staged a demonstration near the general assembly with red flags and banners that poked fun at Porsche chief executive Wendelin Wiedeking.
"We are here to save our jobs," said Dirk, a 35-year-old mechanic at the main VW plant in Wolfsburg and one of several hundred workers at the rally.
VW works committee head Bernd Osterloh told the German magazine Stern meanwhile that "we are capable in the coming years, with or without Porsche, of becoming the number one worldwide."
VW could also "become at least as profitable as Toyota," which the German group sees as its main rival.
"Porsche builds 100,000 cars a year and earns, along with its investments, a lot of money," Osterloh acknowledged.
"But that does not mean, far from it, that a medium-sized enterprise is also able of successfully running a group with 360,000 workers."
One of the union's main objections is that Porsche intends to bring both automakers under the umbrella of a holding company that would give workers from each group the same number of seats on its supervisory board.
VW workers outnumber those at Porsche by a ratio of about 30 to one.
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