BizNomic

Volkswagen AG, Europe’s biggest car maker, said today that it will issue up to 65 million new preference shares (worth about €4.5 billion ($6.1 billion) at current valuations) in a move to boost its balance sheet ahead of the proposed merger with Porsche Automobile Holding.

“The net proceeds from the offering of the new shares are intended to be used for the purpose of enhancing Volkswagen’s capitalization against the background of the planned creation of the integrated automotive group with Porsche,”

Europe’s largest auto maker by sales said in a statement, reiterating previous comments. In addition, the deal should “strengthen the financial stability and flexibility as well as to maintain the current credit ratings of Volkswagen.”

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