Bailout Takeover

How many Porsches do you see on the road every day? How many Volkswagens do you see? Porsche is a high-end brand that was seeing a slipping share of automotive sales. Continued slippage would have ended the car brand entirely. Yes, Porsche was, in fact, going bankrupt. VW is/was pretty steady Eddie, but didn't have a high-end sports car. They wanted one...like, who doesn't want a Porsche?

In 2012, VW bought 50.1% of Porsche. Progress report: By 2017, Porsche set a sales record for the sale of Porsche models worldwide. With 237,788 Porsche cars sold worldwide, including a record number of 911 models, Porsche seems healthy. Now VW...that diesel faux pas didn't help.

The VW/Porsche merger represents a bailout takeover. A more profitable or stable company obtains control of a financially troubled company to turn around its situation. In a bailout takeover, stronger entity takes over the weak company, in total by purchasing all existing shares...or in part by purchasing a controlling portion of shares, 50+%.