An Intriguing Day in History –
On July 21, 1960 Germany passed what is referred to as the Volkswagen law; which transferred control of the car company from the German Government (which acquired it from the destroyed Nazi’s at the end of WWII) to a variety of private regional government owners. A distinguishing feature of the law was that no one entity could hold more than 20% of the voting stock of the company. The German people retained 20% ownership and the region in Germany known as Lower Saxony retained 20%, and the rest open for private, stock traded purchase.
The idea was that no one conglomerate could control Volkswagen and set it up for a hostile takeover and disruption of the company.
That worked pretty well up until the European Union came into existence with laws regarding the free flow of capital across borders. A European judge ruled the Volkswagen law was against the capital flow mandates of the new European Union and this opened the way for parties to buy more than 20% of the company.
Porsche stepped up and quickly bought 30.9% of Volkswagen. This set up a takeover bid under a different German law that required a company which acquires more than 30% stock to bid for the entire company. Over a period of two years, Porsche bought controlling interesting in Volkswagen and now effectively owned Volkswagen.
But, Porsche and Volkswagen have shared a long and interesting history. After all, it was Ferdinand Porsche who designed the original Volkswagen — the German People’s Car!
Comments on this interesting history are welcome. My thought is that lawyers and bureaucrats likely own a chunk of the company for all the legal and regulatory fees involved in making the deals to get Volkswagen owned by Porsche.
Anyway, whoever owns it, Volkswagen and Porsche remain essentially German companies.