Volkswagen's shares more than doubled yesterday after Porsche moved to cement its control of Europe's largest carmaker and hedge funds, rushing to cover short positions, were forced to buy stock from a shrinking pool of shares in free float.

VW shares rose 147 per cent after Porsche unexpectedly disclosed that by means of derivatives it had increased its stake in VW from 35 per cent to 74.1 per cent, provoking outcry by investors, analysts and corporate governance experts.