Former Porsche CEO charged with market manipulation
STUTTGART, Germany (Reuters) - German prosecutors have charged former Porsche SE PSHG_p.DE Chief Executive Wendelin Wiedeking and his former finance chief with market manipulation related to the purchase of Volkswagen (VOWG_p.DE: Quote) shares.
The prosecutor's office in Stuttgart, where Porsche is based, said on Wednesday the executives made false public statements during the sportscar maker's botched 2008-09 takeover of VW.
The defendants' lawyers denied any wrongdoing by their clients.
Wiedeking, hailed as "the man who outfoxed the market" by Fortune Magazine in January 2009, and Holger Haerter could face a sentence of up to five years if they are found guilty of breaching securities trading laws, a criminal offence, prosecutors have said in the past.
Investors have said Porsche's former top management had been pursuing plans to take over much larger carmaker VW while making public statements to the contrary.
In March 2008, Porsche dismissed as "speculation" media reports it intended to take over VW, which builds more cars in a week than Porsche does in a year.
Seven months later, Porsche disclosed it had options giving it control of almost three quarters of VW, sending its shares higher and forcing short-sellers to race to buy back stock they had borrowed betting that VW shares would drop.
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The historic short squeeze pushed VW shares above 1,000 euros ($1,300) each within days, briefly making the Wolfsburg, Germany-based carmaker the world's most valuable company and triggering accusations of market manipulation. Continued...