Another twist in Germany’s most colourful corporate saga: prosecutors are probing suspected market manipulation by Porsche related to Volkswagen shares. Porsche denies it, saying its former chief executive and finance director – who led the abortive takeover attempt of VW – will co-operate with the investigation. VW shares are, meanwhile, crashing to earth after hovering way above any conceivable fair value since the short squeeze in the autumn – when Porsche revealed it had options to increase its VW stake from 50 per cent to more than 70 per cent. VW ordinary shares have slumped 36 per cent since news last week of its compromise merger with debt-laden Porsche.

The trigger was Porsche, as part of last week’s deal, selling 10 per cent of itself and most of its VW options to Qatar Holding. The Qataris plan to exercise options over 17 per cent of VW’s shares. Hence VW’s free float, which had technically been almost 27 per cent, drops below 10 per cent, probably knocking the shares out of Germany’s DAX index and reducing their Euro Stoxx index weighting by two-thirds. Cue selling by institutions. Meanwhile, Qatar Holding paid €80 per share for its options – roughly what analysts consider fair value. The shares will probably slide towards that level.