Luxury carmaker Porsche was investigated by German authorities on Thursday in a move related to the company's purchase of cash settled options in Volkswagen last year.
According to a Porsche statement, officials from the public prosecutor's office in Stuttgart arrived at the company's administrative headquarters with judicial search warrants. The officials then searched the premises, seizing numerous business documents in the process.
The search was based on the suspicion of "breaching the publication duty as prescribed by the German Stock Corporation Act" and market manipulation.
Porsche said in its statement that it rejects the allegations. "The company is cooperating in the efforts of the public prosecutor's office and is offering investigating officials its full support in order to clarify the issue as quickly as possible," it continued.
In October last year, Porsche announced it had amassed a further 31.5% in Volkswagen, pushing its ownership to over 74%. However, controversy centred on the fact that the 31.5% was obtained in the form of cash settled options, which cast Porsche in the role of a hedge fund rather than a car company. (Click here to read our coverage of the story)
Control of VW was part of Porsche chairman Wolfgang Porsche and non-family CEO Wendelin Wiedeking's plan to takeover its larger rival. However, their bold attempt failed amid huge debt and the onset of the financial crisis. The two companies are now going through a complex merger. (Click here to read our coverage of the story)
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