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Last updated at 12:55 BST, Friday, 28 August 2009

Porsche probe

Summary

28 August 2009

German prosecutors say they are investigating the former head of the car maker Porsche and a former chief financial officer - as part of an inquiry into allegations of market manipulation and insider trading linked to a takeover bid for Volkswagen.

Reporter:
Mark Gregory

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Porsche logo

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Report

Porsche attempted to acquire a controlling 75% stake in Volkswagen through complex financial manoeuvring last year. The bid ultimately failed as Porsche built up huge and unsustainable debts.

Prosecutors launched a probe into claims of market manipulation and insider dealing associated with the aborted takeover some time ago. It's now been confirmed that former chief executive of Porsche, Wendelin Wiedeking, and former chief financial officer, Holgar Haerter, are being investigated as part of these inquiries. Both men left the company last month.

Porsche denies accusations of wrongdoing and says it's co-operating with the authorities.

Mark Gregory, BBC News

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Vocabulary

to acquire

to buy (a business term)

through complex financial manoeuvring

by carrying out a great number of various complicated money transactions

the bid ultimately failed

the takeover attempt was not successful in the end

unsustainable debts

when a company owes too much money to other companies or banks to be able to function normally for a considerable period of time

launched a probe

began an investigation

market manipulation

controlling prices on the market; artificially making prices go up or down (e.g. through suddenly selling or buying a lot of stocks and shares)

insider dealing

illegal share dealings where people use confidential information about prices to make a profit

aborted

stopped

denies accusations of wrongdoing

insists it has done nothing wrong, even though others say it has