(MENAFN - AFP) A German prosecutor said on Wednesday that the former head of German luxury sports car maker Porsche had been charged with market manipulation over a failed takeover bid of Volkswagen.
Wendelin Wiedeking, as well as Porsche's former finance chief Holger Haerter, are accused of having publicly given "false information" on Porsche's plans in 2008, the public prosecutor in the southern city of Stuttgart said.
Between March and October of that year, Porsche "denied in at least five public statements an already existing intention to increase its participation in Volkswagen AG to 75 percent", it said.
However investigators believe the accused had already planned by February 2008 at the latest to increase its stake and began preparations to do so the following month, the prosecutor said in a written statement.
Several months later Porsche made the surprise announcement that it held 75 percent of Volkswagen.
The denials affected the share price of Volkswagen, the prosecutors said adding that the false statements prompted investors to buy and sell Volkswagen shares.
Defence lawyers for Wiedeking and Haerter said in a joint written statement that the accusations were "unfounded".
"Such an accusation cannot be successful," they said.
A court in Stuttgart must now decide on whether to open proceedings.
The prosecutor also said it had dropped investigations against the accused over suspicions of breach of trust because it could not be proven that they had deliberately endangered their company.
Porsche failed to swallow the much larger VW, running up more than 10 billion euros (13 billion) of debt in the process, and VW instead launched a takeover of Porsche, initially acquiring 49.9 percent in Porsche in 2009 in the first stage of a complex takeover agreement.
In August Volkswagen announced it had wrapped up its takeover of Porsche two years earlier than planned in a move it said would strengthen both firms.