But this scenario could play out in Germany, where Volkswagen is hoping for a savior in its battle with Porsche as the latter attempts to buy a larger stake in its German cousin.
Right now the major concern between the two companies is the fact that major shareholders can influence decisions made by Volkswagen. Porsche wants to change that. But one major shareholder is stepping forward to try and stop it. That major shareholder is Lower Saxony, a province of Germany. Under German law, local governments to hold a stake in private companies.
According to the Detroit News, Lower Saxony has 20.1 percent of Volkswagen and that gives it the right to block major decisions at VW. Porsche wants the rule to change and allow shareholders with a 75 percent stake to be allowed to block decisions. If adopted, the rule would close out Lower Saxony. Porsche owns 31 percent of VW right now. Rumor has it that the company will attempt to purchase more.
To further complicate matters, the European Court of Justice struck down what is referred to as the “VW Law” which gives Lower Saxony its ability to step in and block decisions. The rule is meant to stop any attempt of a hostile takeover of VW.
Our take? So the battle is joined.