Nov. 18 (Bloomberg) — Germany’s billionaire Merckle family, stung by losses on Volkswagen AG shares, needs as much as 1.1 billion euros ($1.4 billion) in financing to avert insolvency of its investment company, four people familiar with the situation said.
The family’s investment company VEM Vermoegensverwaltung GmbH may be forced to file for insolvency if a so-called standstill agreement that would freeze banks’ claims isn’t extended before today’s deadline, said the people, who declined to be identified because the talks are private. Merckle needs between 600 million euros and 1.1 billion euros, the people said.
Adolf Merckle, 74, whose estimated $9.2 billion fortune puts him 94th on Forbes’ list of the world’s richest people this year, needs financing after losing as much as 700 million euros on wrong-way bets on VW stock and the value of HeidelbergCement AG, which it owns, plunged, the people said. A failure of VEM could have repercussions for Merckle’s holdings, which span as many as 30 companies in the cement, machinery and pharmaceutical industries, said the people.