* Wants to reinvest in 'automotive world'
* Says all pending legal claims without merit
* Sees post-tax profits in low single-digit billions of
By Christiaan Hetzner
MUNICH, March 19 (Reuters) - German holding company Porsche
SE plans to use its 2.6 billion euros ($3.4 billion)
in cash to invest in mid-sized companies, it said on Tuesday,
killing off investor hopes of a special dividend.
"We are first and foremost going to focus on the major
global trends in the automotive industry such as sustainability,
conservation of resources and the increasingly networked
automotive world," Chief Executive Martin Winterkorn said in a
statement on Tuesday.
Porsche, which is still controlled through voting shares by
the Porsche and Piech families while ordinary investors hold
preference shares, has been searching for a new business model
ever since investor lawsuits forced it to ditch plans to be
taken over entirely by Volkswagen. Instead it was
left holding the cash and a 50.7 percent ordinary shareholding
in VW after selling the carmaking business alone.
Many of the preference shareholders in Porsche SE, who had
earlier bought into the company in the expectation of a full
merger with VW, have since demanded the company return the cash.
But management then hired Rothschild banker Philipp von
Hagen to find prospective investments, in everything from
renewable energy to real estate, and some investors fear this
could further increase the discount to net asset value at which
the holding company's preference shares trade.
Barring acquisitions, Porsche said it should report a
profit after tax in the low single-digit billions of euros for
the next two years based on the current group structure.
Porsche SE is also still fighting legal claims that at one
point totalled $3.9 billion after U.S. hedge funds, who were
caught short of ordinary shares in Volkswagen in 2008 after it
emerged that Porsche had effectively cornered the market through
the use of call options, contended that they had been misled
over Porsche's plan to acquire Volkswagen.
"We continue to consider all pending claims against Porsche
SE to be without merit - and those in the United States and the
United Kingdom to be legally inadmissible," Winterkorn said.
"And we will continue to use all legal means at our disposal
to defend ourselves against the damage claims filed."
Recently 12 of a total of 32 plaintiffs withdrew their
appeal against the dismissal of their claims against Porsche SE
by a U.S. federal court.
This does not affect the appeal proceedings relating to the
remaining 20 plaintiffs, Porsche SE said, adding that more
claims are likely to be filed in Germany.
A spokesman for the company declined to put a figure on the
current outstanding claims made against the company.