Qatar buys 10% of Porsche

While owners of vintage Porsche racecars gathered at the 2009 Monterey classic car event in the United States, Porsche and Qatar Holding LLC signed an agreement in Germany whereby the Qatari government will acquire 10% of Porsche shares.

The sale was triggered after Porsche, enjoying decades of high profits, decided to buy Volkswagen piece-by-piece, and instead ended up in massive debt when the recession hit. The freak-up will probably become a chapter in future business textbooks on how not to conduct business.

In a second agreement, Qatar can take “a major share in the cash settled options relating to Volkswagen shares,” which vaguely means that the small GCC country will get a piece of Porsche’s VW shares too.

For the first time in Porsche’s history, an external investor has acquired a holding of ordinary shares that so far have been solely owned by the family members of Porsche and Piëch.

In a further step to reduce Porsche SE’s debt, Porsche’s controlling families will sell their automobile trading business to VW. Volkswagen has also gone on record bragging about Porsche soon becoming its latest brand, in a portfolio that includes Audi, Bugatti, Bentley, Lamborghini, Skoda, Seat and Scania. Now that is a disturbing thought.