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article imageFormer 'Mr Volkswagen' Piech in talks to pull stake

By AFP     Mar 17, 2017 in Business

Volkswagen's powerful ex-chairman Ferdinand Piech, credited with its rise from the brink of bankruptcy to world leader status, is in talks to sell his stake in the group, its holding company said Friday.

The 79-year-old owns 14.7 percent in Porsche SE, which in turn controls the Volkswagen group with 52 percent of its voting rights.

The stake owned by the former 'Mr VW' is worth more than 1 billion euros ($1.07 billion), according to Spiegel Online, which first flagged the talks and said they followed differences with Porsche's founding families.

The negotiations cover the sale of "the major part" of Piech's Porsche SE holding to the Porsche and Piech families, which have first dibs on the purchase, Porsche SE said in a statement.

"At present, it is still unforeseeable whether the aforesaid changes in the shareholder structure of Porsche SE will in fact occur," the statement said.

Relations with the current management and the other co-owners of Volkswagen became strained after Piech claimed that company chiefs, including CEO Martin Winterkorn, knew about emissions cheating which led to the so-called 'dieselgate' scandal earlier than they admitted.

After fitting 11 million cars with devices allowing them to fool emission tests, Volkswagen in January agreed to plead guilty and pay $4.3 billion in criminal and civil fines to settle charges that it defrauded the United States and conspired to violate the Clean Air Act.

- Dieselgate got personal -

This added to the $17.5 billion that the company already agreed to pay in settlements with car owners and dealers for environmental cleanup.

Last month, the board members targeted in Piech's allegations rejected them as "false".

An internal investigation had examined Piech's claims last year and found no evidence, they said.

According to German tabloid Bild, Piech told prosecutors in the German city of Brunswick that he heard rumours about the emissions fraud in February 2015, while he was still chairman of the supervisory board.

He reportedly put the allegations to then-chief executive Martin Winterkorn, who denied them, and to some members of the board.

The allegations have explosive potential as so far VW has always denied that senior management knew of the cheating before it became public knowledge in September 2015.

As the grandson of the inventor of the VW Beetle and a member of the Porsche-Piech clan that owns much of the group, Piech long ruled VW with an iron fist.

But a confrontation with Winterkorn, his former protege, cost him his place at the head of the supervisory board in April 2015.

Germany media have said that his last remaining post as a supervisory board member at Porsche SE itself is now also on the line.

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