STUTTGART, Germany (AP) -- Porsche Automobil Holding SE started out with the goal of acquiring much larger Volkswagen AG but in the process got upended by the financial crisis -- and now finds its sports car business about to be put under VW's umbrella in a merger.
-- How did this happen?
Highly profitable Porsche moved on Volkswagen AG, Europe's biggest car company by sales, led by Chief Executive Wendelin Wiedeking. The two companies already work together on making sport-utility vehicles.
-- How was Porsche going to buy VW?
With euro113 billion ($160.36 billion) in 2008 revenues, VW is more than 15 times bigger than Porsche. Porsche aimed to take over VW with complex stock options, which, along with other investments, earned Porsche so much money for a time that some analysts started to ask whether Porsche was an auto company or a hedge fund. It built up a 51 percent stake.
-- What went wrong?
The market for cars, credit and investment quickly dried up as the economy tanked. Porsche found itself unable to hold on to the options, credits and other positions at a profitable level. Now it's saddled with euro9 billion in debt and says it will seek euro5 billion in new capital while holding merger talks with Volkswagen.
