Former Porsche bosses acquitted over VW takeover

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After an eight-year saga, the former CEO of Porsche, Wendelin Wiedeking, has been acquitted of alleged market manipulation.

A court in Stuttgart also rejected the same charges against his ex-colleague and former CFO, Holger Haerter.

The two former executives both faced charges relating to Porsche's infamous attempt to take over Volkswagen (VW) in 2008.

Stuttgart regional court Judge Frank Maurer said Friday the court had come to a clear decision and a conviction would not have been "rationally justifiable".

"The board had no secret plan," he said.

At the time, Porsche's plan was to hoover up derivatives contracts to quietly build a stake in Volkswagen.

Some hedge funds had bet heavily against VW, as the auto industry slowed in the wake of the financial crisis.

But when details of Porsche's plot emerged, VW shares spiked from 200 euros to more than 1000 euros, briefly capitalizing VW as the most valuable car company in the world.

In turn, those hedge funds who had bet heavily against VW encountered heavy losses.

Friday's ruling in the criminal case will come as a blow to hedge funds that have instigated separate civil suits against Porsche.

The plan unravels

The takeover plan came to light in October 2008 when after months of denials, Porsche unveiled its holding of VW options contracts and its intention to control Volkswagen.

Combined with conventional shares, Porsche suddenly held near the 75 percent required to take ownership of VW.

However the act of aggression stumbled in 2009 when Porsche ran into debt problems, and in a twist VW was forced to rescue its would-be owner in a reverse takeover.

Both Wiedeking and Haerter resigned and were subsequently charged with misleading investors over exactly when they had decided to attempt a takeover of VW.

In 2015, further charges were laid in relation to a press release which German prosecutors said gave a false impression over the number of VW shares available on the market, thereby manipulating price.

Prosecutors had sought roughly 800 million euros ($869.5 million) in fines as well as jail time for the two executives.

German authorities can appeal the decision and take the case to a federal court.

Porsche SE remains the dominant shareholder in Volkswagen.