Porsche chief paid $87 million to leave his job

Heard about the boss who gets paid multi-millions of dollars to get out of his job??? Like more than $80 million??? Well, see article below - it IS true, it DID happen. And I thought we are supposed to be in a worldwide recession, with the global financial crisis & all that.

I was just blown away - $87 million exit payout. Just like that. That is just obscene. And all that, at a time when people are losing their jobs & struggling to get back into the workforce. And here we have this guy given the equivalent of lottery money (in fact, even more than that) to get out of his company. What's he going to do now?? The guy is financially set for life - he doesn't have to work anymore.

Imagine what I would do if I am given just 1/10 of that. That will still be a lot of money - for me, anyway. Hhhhhmmmm, with just under $9 million, I'd give a portion to my family & friends (I'm sure lots of people would suddenly clamour to be my friend), a portion to my church, & a portion to other Christian organisations (charities, missions, etc). Then I would buy myself a nice waterfront property, expand my investment portfolio, & take a tour of the world. Whatever money is left, I shall squander. Hahaha!

Anyway, here is the article (which I saw on NineMSN):

Porsche chief paid $87 million to leave his job
24/07/2009 6:52:15 AM

The boss of Porsche will be paid $87 million to leave his job after the luxury sportscar maker was taken over by Volkswagen (VW).

Wendelin Wiedeking, who was Germany's highest paid executive, was pushed out after his bold plan to take over VW backfired leaving Porsche with more than $17 billion of debt.

The tables were then turned and Porsche itself became the subject of a takeover bid from VW.
The VW takeover cranks up a campaign from Europe's biggest carmaker to challenge Japanese rival Toyota.

VW also said on Thursday the Gulf emirate of Qatar would buy 17 per cent of VW shares amid a broadside of news that rocked the German car industry and served notice to international competitors, especially recovering US giant General Motors.

The developments emerged from an epic corporate boardroom battle that fuelled a caustic family feud and left Volkswagen standing tall.

But its ultimate shareholder structure and management team were still in suspense.

Nevertheless the deal leaves VW a small step closer in terms of vehicle sales with world number one, Japanese giant Toyota.

VW wants to overtake Toyota by 2018 and could pass US behemoth General Motors this year to become number two worldwide as GM emerges from bankruptcy and slims down in an effort to survive.

Porsche chief executive Wiedeking, the principal victim in the struggle, said he would step down after losing a long battle against VW supervisory board president Ferdinand Piech for control of both companies.

"We have opened the way ... to the creation of an integrated group," VW chief executive Martin Winterkorn said following a meeting of his group's supervisory board in Stuttgart.

The concept approved by both companies includes the integration of Porsche's car activities into VW and a reinforcement of the overall Porsche holding group's finances to guarantee its independence within the European auto giant.

Winterkorn's comments came after the owners of Porsche said they would also wrap up talks with Qatar and raise at least 5 billion euros ($A8.7 billion) in fresh funds via a capital increase.

Further details of the new arrangement would be released on August 13 following another meeting of the VW supervisory board, the group said.

Porsche's owners, the Porsche and Piech families who are descendants of the company founder Ferdinand Porsche, said early on Thursday following all-night talks that Wiedeking would resign and that "the basis for the creation of an integrated group between Porsche SE and Volkswagen AG" had been laid.

Wiedeking - said to be the best-paid boss in Germany - was to get 50 million euros ($A87.08 million) in severance pay, of which half would go to a "social foundation" to aid Porsche workers and others.

Wiedeking and Porsche finance director Holger Haerter, who also resigned, had devised a bold financial strategy to take over VW based on complex stock options in the much bigger group.

Porsche SE, the holding company, currently owns 51 per cent of the shares in VW.

The plan collapsed however, leaving Porsche with 10 billion euros ($A17.42 billion) in debt, and putting Piech in a position to turn the tables and take Porsche on as VW's 10th brand.

Porsche production chief Michael Macht, 48, is to succeed Wiedeking as head of Porsche's core carmaking division, the company said.

But the prospect of VW swallowing up Porsche might provoke bitter resistance.

At a rally of 5,000 Porsche workers in Stuttgart, major shareholder Wolfgang Porsche insisted the maker of 911 sports cars would remain independent.

"Trust me ... the Porsche myth is alive and will never founder," he told the boisterous crowd with a trembling voice.

"The families are in complete agreement on the fact that Porsche's success is founded on the brand's independence," he said, and Porsche would now "negotiate with VW on equal terms."

Porsche abandoned Wiedeking's ambitious plan to take full control of VW and its hefty reserves of liquidity in May, and was forced to find other sources of financing.

The German state of Lower Saxony, which owns 20 per cent of VW and holds a veto over its strategic decisions, stood between Porsche and VW's cash.

Lower Saxony regional premier Christian Wulff said on Thursday that Porsche would remain an autonomous group along the lines of VW's high-end unit Audi.

"We will work together to become the world number one" automobile maker, Wulff added.


Link: http://money.ninemsn.com.au/article.aspx?id=841157&print=true&_defaultfontSize=11&_js_siteid=255

Pfffhhh....another one of these invites

Wow, feels like I'm a wanted person, with all these invitations I'm getting. Remember a couple of invitations I've got from the ICAA these past few months to apply for a CA American Express Platinum Card? Each time, I turned them down. Well, my bank St George has just sent me a special invitation (that's what the letter said, special invitation) to apply for Australia's lowest rate Platinum Credit Card, with a conditionally approved credit limit of $10,000. The annual fee is just $89, the lowest in Australia. Compare that to the $295 annual fee for American Express Platinum Card.

Like the AMEX Platinum invitations before, I will toss aside the St George Platinum invitation. Signing up for the St George Platinum Visa means an extra $10,000 credit limit to my name. Given a potential "change in circumstances" in the foreseeable future (which I shall not elaborate here), the last thing I need is a hike in my credit limit. In fact, I need to cut down what credit limit I already have. I will have to look at my 3 current credit cards & look to reduce some of the credit limit, & possibly ditch at least 1 of those cards. One day, I might sign up for the St George Platinum card. But not now. Now's not a good time.

Resisting the platinum invitation - again

The ICAA sent me another invitation to upgrade from my current CA Gold American Express (nil annual fee) to the Platinum American Express. It's exactly the same as the invitation I received a few months ago, & which I posted on - refer "Nice invitation, but I say no".

Only this time, there's an additional American Express brochure (which I don't think came previously). Now this brochure is intended to suck people in to take up the Platinum offer. One look at the brochure & u can tell this is the case. It starts with the heading in bold caps:

Some things in life just have to be experienced

More bold caps follow:

Live like a high-flyer - every day
Experience endless rewards
Shop with complete confidence
Get treated like a VIP
Empower yourself financially

In amongst those bold headings are lots & lots of explanations on how good the Platinum card is, what benefits it offers the card holder, & a few bright & glitzy pictures. I laughed when I see this. The ICAA & American Express (both of which are business partners) just don't give up, do they. They must be thinking like this: If people like DT don't sign up first time, let's send them another invitation.

Nice try. But for reasons previously posted, I won't be signing up for the Platinum AMEX anytime soon. Nevertheless, I can't help but feel a tad "privileged" to be considered for offers such as these.

This is what my current CA Gold Card looks like. The look's not that great. The "real" American Express Gold card looks much better, as it has a similar appearance to the Platinum one below, except that it's gold, of course.

This is the Platinum Card. Much better looking than the above card, it's got "eye candy", but it would set me back $295 in annual fee if I were to take up the offer.

Having a bit of a whine.....

Uh huh, just as I thought, more bills to pay within the next month or so. The car insurance renewal certificate from NRMA came in the post today, & so did the RACQ membership renewal notice. Just add this to the list of "compulsory" expenditure which I previously blogged on. I know this might sound a bit like a whine, but why does everything have to come at once???!!!

Ai yah, at a time when I felt like indulging myself with Myer's mid-season sale, I may have to hold back on my spending because of all these bills. Arrrggghh, never mind, what can I do. It's part of life. Anyways, let's surf to the various managed fund websites, eh, & see how my investments are going. I want to see growth!! I want to see increasing unit prices. Ya hear me!! Money money yeah yeah....

Thereafter, I might even write up another post before the end of the night. Hmmm, that sounds like a plan. Oh well, I'll get into it, & might be back later tonite eh.

Stretching the financial pocket a bit

June's coming up (whoa, time really flies, huh), & it's around that time of the year (end of June to start of July) that I have to shell out some money, on "compulsory" items.

Just came in the mail today is the ICAA annual subscription fee/membership renewal. And oh, surprise surprise, they've upped the subscription fee a bit (by $20). Some things go up but never down. Hmm, I wonder why....

That's one thing. Just a few days ago, my car registration came in the mail. And, I'm expecting my car insurance renewal to come within the next couple of weeks.

So yeah - ICAA membership renewal, car registration, car insurance. All to be paid virtually in "one hit" (by end of June or early July), all around the same time. And that's because I got the ICAA membership around this time last year, & bought the car around this time 4 years ago. Any more "compulsory" expenditure to come???

Oh well, I will use the credit card where possible, to make use of the interest-free days. Pay them around end of June or early July via credit card, then pay off the credit card around the end of July. That means a few more pay days before I pay off the credit card.

I'm just glad the income protection insurance won't come out until December. Come that time, I'll pay that insurance together with all my Christmas "splurges"!

Meantime, I will look around for any good opportunities to grow my money. Money money yeah yeah.........

Nice invitation....but I say no

I received an envelope from American Express (AMEX) in the post today. The words "Your Invitation" appear on the front. Inside the envelope is a letter with the CA logo at the top left & a picture of an AMEX Platinum card at the top right. The letter is an invitation by AMEX to me to apply for a CA AMEX Platinum Credit Card. The invitation is pre-approved, i.e. simply meet the income & credit criteria, & my application for the Platinum card (should I decide to apply) will be approved.

I received the AMEX invitation by virtue of holding a CA AMEX Gold Credit Card. The letter, apparently, is an invitation to take my AMEX up to the platinum level. The letter harped on about the benefits of holding the Platinum Credit Card:

• 1 Qantas domestic economy return flight every year - together with domestic & international travel insurance; plus complimentary annual subscription to Travel & Leisure Australia magazine.
• Earn rewards at a faster rate - 1.5 Membership Rewards points for every $1 spent up to $100,000 per year, & 1 point for each $1 thereafter. The cardholder will continue to be enrolled in the rewards program for no additonal cost, saving $80.
• A higher level of financial benefits (without specifically outlining what the benefits are), for a preferential annual fee of $295 for CA members - a saving of $100 per year, as the standard fee is $395.
• Having a generous credit limit, & "enjoy" a competitive interest rate.
• Yada yada yada....

I looked again at the image of the Platinum Credit Card at the top right side of the page. It looked good & very glossy. I'm impressed! Then I looked at the enclosed AMEX application form, which also contained an image of the Platinum Credit Card (albeit smaller than the one on the letter). I remain impressed! An image then crossed my head, of myself complete with suit & tie, holding a shiny Platinum card.

I read the letter again - & then decided not to pursue the thing. Call it what u want - a fad, a marketing exercise, consumerism, materialism, moneyism etc. I am no expert at these phrases (perhaps in mentioning them, I'm misusing them), but u might get the idea what I'm on about. You see, AMEX is a business partner of the Institute of CA (other professions have similar arrangement with AMEX, too). CA members get special offers from business partners of the Institute. In the case of AMEX, CA members (such as myself) are offered AMEX cards, with special offers in the form of reduced/nil annual fees, faster rewards points, whatever. The Institute gets money from AMEX for offering AMEX products to CA members. The more CA members sign up for AMEX cards, the more money the Institute gets. And of course, the more people sign up for AMEX cards, the more money AMEX will make, especially if people get slogged with interest charges when they pay their credit card balances after the interest-free period. It's a win-win for both the Institute & AMEX when CA members sign up for AMEX cards - & they do make it seem attractive for people to sign up.

So, if I were to sign up for the AMEX Platinum Credit Card, it would mean that AMEX gets $295 from me each year for the privilege of using the card. If I were to pay the AMEX balances after the interest-free period, AMEX would get more money from me through interest charges. Do I want to hand AMEX $295 each year? Hmmm, no. Yes, I'm aware of all the rewards points & all that niceties & razzamatazz that come with the platinum plastic. But I don't really need them & it's probably not advisable to go for them - I don't spend $100,000 a year, I don't even earn anything like that each year.

Hence, I won't be taking up this particular platinum card offer. Who knows, I might consider the Platinum card in the future, depending on future circumstances. But for the moment, I'll stick with the AMEX CA Gold Card - no annual fees ever. Asians just love anything that's free - that's why I signed up for the Gold Card a couple of years ago. Plus, I already got the Virgin Mastercard & JBWere Visa Gold. So, that's enough credit cards already.....perhaps more than enough.