FRANKFURT, Aug 14 (Reuters) - Stuttgart prosecutors have dropped a case against members of Porsche Automobil Holding SE’s supervisory board including Ferdinand Piech and Wolfgang Porsche for suspected market manipulation, they said on Friday.
But they are still pursuing a separate case against former chief executive Wendelin Wiedeking and ex-finance chief Holger Haerter, relating to Porsche’s botched attempted takeover of Volkswagen in 2008.
Porsche SE on Friday hailed the dropping of the case against the supervisory board members, for which the prosecutors’ office gave no immediate explanation, though it said it would give a more detailed statement next week.
“We welcome the decision by prosecutors and remain confident that the allegation of market manipulation against former management board members will prove to be unfounded,” said Wolfgang Porsche, supervisory board chair at Porsche SE.
The affair goes back to 2008 when Wiedeking’s manoeuvres to take over Volkswagen eventually backfired and pushed Porsche SE near bankruptcy. To pay down its debt, Porsche SE was forced to sell its sportscar business to Volkswagen.
Porsche abandoned its takeover attempt but still holds a 51 percent stake in Europe’s largest carmaker. Piech, a grandson of the inventor of the VW Beetle, was chairman of VW until April, when he was forced out in a boardroom battle.
Porsche SE had originally attempted to gain a 75 percent stake in Volkswagen through tactics including the use of derivatives.
Some investors have accused Porsche’s former top management of pursuing plans to take full control of VW far earlier than it admitted. When Porsche eventually announced it had accumulated options giving it control of almost three-quarters of VW, this sent the mass-market carmaker’s shares higher and forced short-sellers to race to buy back stock they had borrowed in a bet VW shares would decline.
The prosecutor’s office in Stuttgart has alleged Wiedeking and Haerter made false public statements during the takeover. The defendants’ lawyers have denied any wrongdoing by their clients.
Prosecutors want to explore whether Porsche’s failure to disclose the ownership of a package of Volkswagen derivatives at an earlier stage amounts to misleading the market.
Haerter and Wiedeking could face sentences of up to five years if they are found guilty of breaching securities trading laws, a criminal offence, prosecutors have said in the past. (Reporting by Edward Taylor and Jan Schwartz; Editing by David Holmes)