VW scraps merger talks with Porsche

I thought that this was going through already…

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VOLKSWAGEN AG, Europe’s largest car maker, called off talks with Porsche SE about a merger less than two weeks after the sports-car manufacturer’s controlling families agreed to explore a merger.

“There is currently no atmosphere for constructive talks,” a Volkswagen spokeswoman said on Sunday.

In a statement, Porsche said while a meeting scheduled for yesterday had been cancelled, negotiations would resume. It did not give details.

Porsche workers were set to hold their first strike ever yesterday to protest against the merger plan, Focus magazine reported.

The Porsche and Piech families, which together control half of Porsche, agreed on May 6 to create an “integrated” carmaker that would put Porsche alongside VW brands including Skoda and Audi.

Talks to hash out details of a merger are on hold after VW Supervisory Board Chairman Ferdinand Piech said on May 11 that VW would not help “solve” Porsche’s financial problem and that Porsche must trim its ‚9 billion ($17.8 billion) in net debt. BLOOMBERG

From TODAY, Business – Tuesday, 19-May-2009

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