Porsche SE shareholders voted in favour of a €5 billion rights issue on 30 November that is designed to reduce the niche sports carmaker's debt ahead of its merger with Volkswagen next year.
Nearly 90% of the company's common shareholders voted in favour of the rights issue, which Porsche hopes will be completed by May 2011.
The rights issue is aimed at cutting the company's €6 billion debt in order to smooth the way for the next stage of its merger with VW, the carmaker that is controlled by a rival branch of the founding Porsche family.
Half of the funds raised by the rights issue will come from the Porsche and Piech families, who control the company's common stock along with the Qatar Investment Authority.
Porsche and VW are headed by rival branches of the same family; Porsche is headed by Wolfgang Porsche and VW by Ferdinand Piech, both grandsons of Porsche's founder.
Porsche had envisioned that his smaller carmaker could do a reverse takeover of the much larger VW and began building up shares in his cousin's business. But by the end of 2008 Porsche had accumulated close to €10 billion in debt and, despite becoming the majority shareholder in VW with a 50.7% share, Porsche was left needing the financial help of VW to survive.
The first stage in the merger was concluded in October 2009 when VW took a 49.9% share in Porsche for €3.9 billion and is expected to be completed by the end of 2011.
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