Porsche has turned down a financial rescue package offer from VW, according to reports in Germany.
VW has reportedly offered Porsche between three billion and four billion euro (£2.6 billion to £3.4 billion) in return for a 49.9 per cent stake in the ailing sports car manufacturer.
A Porsche spokesman said: “It is not a practical way for us to sell 49.9 per cent of Porsche AG to VW.”
Porsche has amassed a nine billion euro (£7.6 billion) debt trying to takeover VW before the financial crisis scuppered its plans. Porsche owns a 51 per cent stake in the firm and has an option of a further 25 per cent of VW shares.
This debt has led to VW reportedly putting pressure on Porsche CEO Wendelin Wiedeking and chairman Wolfgang Porsche to accept the terms of its offer to relieve Porsche’s financial burden.
Porsche had earlier claimed that VW had put pressure on it to accept a deal, something which it likened to blackmail.
Under the terms of VW’s offer, which Porsche would have to accept by the end of today or face having to pay back a 700 million euro (£600 million) to VW by September, Qatar would take Porsche’s options in VW, a move which would further integrate Porsche into VW’s operations.
Once all deals had been completed, VW would be 40 per cent owned by the Porsche and Piech families, 20 percent by Lower Saxony, 15 percent by Qatar, and a sovereign wealth fund would hold 5 percent.