Porsche SE’s Chief Executive Officer Wendelin Wiedeking will pick up a payoff of at least 100 million euros ($141 million) when he leaves the company.
It will be the biggest golden parachute ever given to an industry boss in Europe and dwarfs the record £50m paid to Jürgen Schrempp when he left Daimler in 2005.
Industry insiders speculate that Wiedeking, whose contract runs until 2012, could negotiate an even higher price for his departure, and has hired one of Germany’s top lawyers, Jobst-Hubertus Bauer.
The severance package would consist of what he would earn for the rest of his contract, plus a share package, a lump sum payment and his pension rights, sunday times reported.
After turning Porsche around in the 1990s, he has driven it into one of the biggest dramas in its more than 60-year history.
“I don’t think we have had a comparable situation in the history of the German economy,” German auto expert Ferdinand Dudenhoeffer, reportedly close to Wiedeking, told AFP.
In his gamble to buy VW, Wiedeking used tactics that made Porsche look more like a hedge fund than a car maker and while the good times rolled it made more money through financial transactions than by selling its 911 sports cars and other models.
Complex VW stock options earned Porsche billions as the shares soared in value to more than 1,000 euros at their peak, but on Friday they closed just below 250 euros.
Porsche ended up nine billion euros (12.6 billion dollars) in debt and shelved plans to take its VW stake higher.
An initial target of 75 percent would have given Porsche access to VW’s coveted cash reserves.
VW and its supervisory board chief Ferdinand Piech have now tried to turn the tables on Porsche with a counter-offer.
Piech, a grandson of Porsche founder Ferdinand Porsche, is also a major Porsche shareholder but in a sign of how heated the debate has grown, Dudenhoeffer said the Porsche family “knows they would destroy the heritage of Ferry Porsche if they agree to Piech’s plan.”
Ferdinand (Ferry) Porsche was the founder’s son, but auto analysts say his determination to preserve Porsche’s independence would already be laid low by the sale of a minority blocking stake to Qatar.
Meanwhile, Wiedeking says he has no plans to step down.
“Why should I resign when I have a contract that suits me?” Wiedeking asked reporters Thursday at a ceremony marking the centenary of VW’s Audi unit and media speculation about his future swirled.
Wiedeking, 56 and an engineer by training, took the top post at Porsche in 1993 when the car maker was in dire straits.
He turned Porsche around, but 16 years later the group, which is owned by the Porsche and Piech families, is once again fighting to remain independent.
Wiedeking viewed Qatar as a saviour willing to invest in Porsche without seeking to take it over. While that might not save his job, he might still save face by getting the company out of one last jam.
Wiedeking, who began building Porsche’s VW stake in 2005, sparked opposition among unions and directors of the much bigger car maker by threatening worker’s power and its unique relationship with Lower Saxony, the German state where VW is based.
