Porsche denies "domination" of VW planned by Feb 08

FRANKFURT, May 8 (Reuters) - Porsche (PSHG_p.DE: Quote, Profile, Research) denied on Friday a report alleging it had privately admitted as early as February 2008 its intention to take a 75 percent voting stake in Volkswagen AG (VOWG.DE: Quote, Profile, Research) and pass a domination and profit transfer agreement.

"The accusation that we had misled investors is incorrect. Porsche decided on March 3, 2008, to acquire the majority of voting shares in VW. There was no intention at that time for Porsche to raise its stake to 75 percent of the votes," Porsche said in a statement.

German business weekly WirtschaftsWoche reported Porsche representatives had privately said in February last year they intended to change the VW bylaws to get rid of the state's blocking minority.

In an excerpt provided to Reuters before publication on Monday, the magazine cited a memo written by a senior official attending a Feb. 25 meeting as a delegate for Lower Saxony Premier Christian Wulff.

"After pushing them for a while, the Porsche delegates came clean and said Porsche is aiming for a domination agreement. Should the contract not be signed, the whole takeover was in question," the magazine quoted the state representative's memo as saying.

The official then said to the Porsche representatives that a loss of the state's veto rights would "open the door for (Porsche) to pass a domination agreement", which would lead to Lower Saxony having two seats on what would become a powerless supervisory board, the memo was reported as saying.

In its statement on Friday, Porsche confirmed there had been a meeting on Feb. 25 2008 with a representative of Lower Saxony's government, but declined to comment on the subject of the talks for confidentiality reasons.

Germany's Focus weekly magazine had reported days after the meeting that Porsche planned to take a 75 percent stake in VW, which the company responded to with a press release denying the story.

By the end of October 2008, shares in VW had spiked to 1,000 euros after Porsche revealed it had gained a 42.6 percent voting stake and another 31.5 percent indirectly through call options and intended to raise its holding to 75 percent in 2009. (Reporting by Christiaan Hetzner and Hendrik Sackmann in Stuttgart; Editing by David Holmes)