VW chairman says wants driving seat in Porsche deal

By Jan Christoph Schwartz

OLBIA, Italy (Reuters) - Volkswagen should play the leading role in any merger with Porsche SE , the chairman of VW said in his first public comments on talks to fuse Europe's biggest automaker with the luxury sportscar group.

Ferdinand Piech's remarks demonstrate how the tables may be turning against Porsche in talks about a deal. Although it owns more than half of VW, heavily indebted Porsche has been weakened by the economic slump and could find it harder to get its way.

Talking to journalists at a car launch late on Monday, Piech said that Porsche needed first to get its 9 billion euro ($12.3 billion) debt mountain under control before any details of a merger could be worked out.

"I cannot imagine that VW would assume another company's risks," said Piech, who is also a shareholder in Porsche, adding that he was not in favour of selling a stake in Porsche to an outside investor.

He said in remarks embargoed until Tuesday that it had already been decided that the headquarters for the merged group would be in Volkswagen's home city of Wolfsburg.