Tags: EU | Germany | Volkswagen

Volkswagen Shares Higher Amid Cap Increase

Friday, 26 Mar 2010 08:06 AM

 

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Volkswagen's shares rose Friday after the German automaker set the price for an issue of 65 million new shares aimed at raising some euro4.1 billion ($5.5 billion).

Volkswagen AG on Thursday night set the price for the new shares at euro65 each. Investors cheered the news, making the stock the strongest performer Friday on Frankfurt's DAX index of blue-chip stocks — rising more than 3 percent to euro72.40.

Europe's largest automotive group, based in Wolfsburg, said it would raise about euro4.1 billion through the offer, which started preliminary trading — the so-called pre-placement — this week.

Volkswagen said it expected the new shares to start trading on stock exchanges in Germany on March 31, and in Switzerland, Luxembourg and London on, or close to, that day.

The success of the capital increase is "an important prerequisite for the ongoing healthy financing structure of the Volkswagen Group" and its integration of sports car maker Porsche, chief financial officer Hans Dieter Poetsch said.

He added that there had been "strong interest ... from institutional investors around the globe."

Volkswagen will have 10 brands once Porsche is included into the group. Others include Audi, Seat, Skoda and Bentley.

VW also holds large stakes in two European truckmakers, Germany's MAN SE and Scania AB of Sweden.

Volkswagen has said it wants to sell more than 10 million vehicles annually by 2018 as it pursues current world No. 1 carmaker Toyota.

In 2009, Volkswagen produced 6.1 million vehicles. Toyota sold about 7.6 million vehicles in its last reported fiscal year, but has run into problems with massive recalls in the past months.

This week's pre-placement of new shares came after VW got approval from shareholders in December to issue up to 135 million new shares over the next five years to finance an initial 49.9 percent stake in Porsche — valued at near euro4 billion.

Volkswagen has said it wants to acquire the rest of Stuttgart-based Porsche, the maker of the 911 and Panamera sportscars, in 2011.

It has also said the capital increase will be used to strengthen its financial stability and flexibility and to help maintain its current credit ratings.

Volkswagen's market capitalization, not including the new shares, is about euro28.3 billion.

——

On the Net:

http://www.vw.com

http://www.porsche.com

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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