Advertisement

German court dismisses hedge funds' suit against Porsche SE

STUTTGART (Reuters) - A German court has dismissed claims brought against investment company Porsche SE by hedge funds seeking 1.2 billion euros (869 million pounds) in damages over its botched attempt to take over carmaker Volkswagen in 2008.

Two dozen hedge funds, including Viking Global Investors, Glenhill Capital and Greenlight Capital, last year accused Porsche SE of wrongly concealing a plan to acquire Volkswagen (VW) in 2008, when in fact it controlled share options which gave it an effective majority stake in Europe's largest automaker.

The court did not allow for an appeal of the decision, but the hedge funds can file a complaint with a higher court, Germany's Federal Court of Justice, to be allowed to appeal.

Porsche said in a statement on Thursday this was an "important victory", adding this was the fifth time in a row that the complaint was dismissed.

The case, one of several civil cases lodged at different German courts seeking more than 5 billion euros in compensation, had already been rejected by a separate Stuttgart court.

The appeal denied on Thursday was launched by 19 plaintiffs.

In March 2008 Porsche SE dismissed talk that it intended to take over VW but seven months later revealed it controlled 74.1 percent of VW's common stock, just short of the 75 percent takeover threshold.

Porsche's statement in October of that year caused VW's share price to jump fivefold to just over 1,000 euros within days, briefly making VW the most valuable company in the world as short sellers who had been betting against a takeover raced to cover their positions.

(Reporting by Ilona Wissenbach; Writing by Harro ten Wolde; Editing by Greg Mahlich)