Porsche Eyeing VW

A statement issued after a special board meeting said that Porsche would raise its stake to up to 31 percent, which under German law would oblige it to make a full takeover bid.

Porsche, which had previously denied growing rumors of a takeover move, plans to use an option, exercisable at any time, to purchase up to a further 3.7 percent of VW shares, the company statement said.

However a company spokesman, questioned after the statement was released, said the car maker did not plan to take a majority stake in VW, as media reported.

Porsche spokesperson denies takeover talk

It was an "erroneous interpretation", he said, explaining that Porsche wanted only to pass the 30 percent threshold and trigger the mandatory offer to shareholders and "from that point be free to act."

The Porsche statement said that only the minimum price prescribed by law would be part of its mandatory offer, which is expected to amount to 100.92 euros per VW ordinary share.

Shares in Volkswagen soared in afternoon trading in Frankfurt on Friday after rumors that Porsche, its biggest shareholder, was preparing a public stock offering.

VW shares were up 5.36 percent to 116.74 euros on the Dax index.

A trader said the market was speculating on Porsche making an offer on Monday with shares at between 117 and 118 euros.

Financing of the mandatory offer has been arranged by ABN AMRO bank, Barclays Capital, Merrill Lynch, UBS Limited and Commerzbank AG, the Porsche statement said.

Porsche had earlier expressed its intention of upping its holding to 29.9 percent, just below the limit of 30 percent that would trigger a takeover bid.

But the luxury carmaker said several times it had no intention of exceeding a 29.9 percent holding.