Porsche received 700 mln euro loan from Volkswagen

FRANKFURT, May 24 (Reuters) - Volkswagen (VOWG.DE: Quote, Profile, Research) said it loaned 700 million euros ($980 million) to Porsche (PSHG_p.DE: Quote, Profile, Research), adding a bizarre twist to the German sportscar maker's bungled takeover of Europe's largest carmaker.

A spokesman for Porsche, which owns a 51 percent stake in VW, declined to comment on Sunday.

Porsche was forced to abandon a takeover of Wolfsburg-based VW, struggling under the 9 billion euro debt it had accumulated as of the end of January.

German weekly magazine Der Spiegel reported in its upcoming Monday edition that the loan was made to help prop up Porsche's finances earlier this year and that Porsche's owners had put up Porsche Holding GmbH as collateral for the loan from VW.

Porsche Holding is a Salzburg, Austria-based automotive wholesale distribution firm owned by the Porsche and Piech families, who also control Porsche Automobil Holding SE.

In March, Porsche Automobil Holding SE was struggling to raise 12.5 billion euros in loans to refinance debt.

Porsche eventually raised 10 billion euros, and in the past week said it had raised a further 750 million. The company is still on the lookout for 1.75 billion euros in loans.

After abandoning its takeover plan, Porsche Automobil Holding SE is now seeking a merger with Volkswagen. (Reporting by Christiaan Hetzner and Edward Taylor; Editing by Dan Lalor) ($1 = 0.7145 euro)