Porsche SE May Sell Sports Car Unit Tax-Free

Porsche Automobil Holding SE has found a way to sell its remaining 50.1% stake in its Porsche AG sports car unit to Volkswagen AG without triggering a €1.5 billion tax bill, WirtschaftsWoche reports.

The German business weekly cites unidentified sources in the state finance ministry of Baden-Wuerttemberg, where Porsche SE is based.

State tax authorities have given Porsche SE a binding notice that the 4.5 billion transaction would be tax-free, according to WirtschaftsWoche. The newspaper says the state decided the deal is a restructuring not an asset sale that would trigger the tax because Porsche SE would receive one VW voting share.

Porsche SE and VW tell Reuters they are still evaluating their options for merging the two automakers.

VW, which bought a 49.9% stake in the sports car maker in December 2009, is eager to acquire the balance of the unit so it can fully integrate Porsche into its stable of brands. Porsche SE has balked because it anticipated a €1.5 billion state tax obligation if the deal occurred before 2014.

Porsche SE originally expected to avoid the tax by selling itself to VW, which would thus obtain the rest of the carmaking unit. But the companies were forced to scrap that plan last September because lawsuits against Porsche SE made it impossible to assess the company's value.

A sale of Porsche AG would leave Porsche SE as the holding company for Porsche Design Group, several engineering and consulting units and a 50.7% voting stake in VW.