core sector communique

Volkswagen Aktiengesellschaft resolves upon capital increase

 

• Issue of up to 65 million preference shares planned

 

• Full dividend entitlement of the new shares for 2009

 

• Pre-placement to institutional and private investors planned

 

• Price and offering volume are expected to be published on March 26

 

Wolfsburg, March 23, 2010 - The Board of Management of Volkswagen Aktiengesellschaft has resolved today with the consent of the Supervisory Board to increase the share capital against cash contributions with subscription rights for ordinary and preferred shareholders of the company. The share capital will be increased from existing authorized capital through the issue of up to 65 million new, no par value, non-voting preferred bearer shares against cash contributions. The new shares will have a notional value of €2.56 each and will be fully entitled to dividend rights from January 1, 2009. The capital increase resolution, including the offer price, the subscription ratio and the final offer volume, is subject to a resolution of the Board of Management, with consent of the Supervisory Board, expected to be adopted on or about March 26, 2010.

 

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 and development of the integrated automotive group with Porsche. In addition, the capital market transaction is intended to strengthen the financial stability and flexibility as well as to maintain the current credit ratings of Volkswagen.

 

“The planned capital increase represents an important prerequisite for a continuously healthy financing structure of the Volkswagen Group and for the successful implementation of the mid term strategy especially regarding the further development of the integrated automotive group with Porsche”, said CFO Hans Dieter Pötsch.

 

The CEO, Prof. Martin Winterkorn, explained: “We are and continue to be financially solid. In addition to the strengths of the multi brand automotive group, our technological competence, our young, environmentally friendly and broad vehicle portfolio as well as our global presence, the capital increase will contribute significantly to the realisation of our strategic goals: steadily improving our positioning in the global automotive markets and being the worldwide economically and ecologically leading automotive group in 2018.” 

 

Public pre-placement to institutional investors to start this Tuesday

 

A syndicate of banks led by BofA Merrill Lynch, Citi, Deutsche Bank, HSBC Trinkaus and J.P.Morgan as Global Coordinators and Joint Bookrunners has agreed to subscribe and to underwrite the new shares as well as to offer them to the shareholders by way of indirect subscription rights in accordance with the conditions of the subscription offer expected to be published on March 30, 2010.

 

All new shares shall be offered for purchase in a public offering to retail investors in Germany as well as in private placements to qualified institutional investors in Germany and outside Germany in advance of the subscription period. This pre-placement is expected to start on March 24, 2010 (to institutional investors already today, March 23, 2010) and will terminate prior to the start of the subscription period. The subscription period for the new shares is expected to run from March 31, 2010 to and including April 13, 2010. The offering is contingent upon the approval of the prospectus by the German Financial Supervisory Authority “BaFin”.

 

The subscription price at which the new shares are offered to the shareholders by way of indirect subscription rights, the offer price for the pre-placement as well as the final offer volume will be fixed by a resolution of the Board of Management with the consent of the Supervisory Board and in coordination with the syndicate of banks based on the results of the bookbuilding process for the pre-placement such that the two prices equal each other. The subscription price and the offer price are expected to be published on 26 March 2010.

 

The major shareholders of the company, Porsche Automobil Holding SE and Porsche Gesellschaft m.b.H., Hannoversche Beteiligungsgesellschaft mit beschränkter Haftung as well as Qatar Holding Germany GmbH, agreed to assign and transfer their subscription rights to the new shares to the Global Coordinators effective at the date of the determination of the subscription price and conditional upon the subscription price being equal to the offer price.

 

The admission of the new shares to trading in the regulated market of the stock exchanges of Frankfurt, Berlin, Düsseldorf, Hamburg, Hanover, Munich and Stuttgart is expected on March 31, 2010. The admission to trading of the new shares on the stock exchanges in London and Luxemburg as well as on the SIX Swiss Exchange is expected to occur also on March 31, 2010 or as soon as possible thereafter.

 

The subscription rights for the new shares are expected to be traded in the period from March 31, 2010 up to and including April 9, 2010 in the regulated market (XETRA and floor trading) of the Frankfurt Stock Exchange.