Berlin - The boards of German carmakers Volkswagen and Porsche are meeting Thursday amid signs that VW is moving in for the kill to seize control of the iconic sports vehicle group.

But while the VW board is expected to agree in principle to an 8-billion-euro (11.3-billion-dollar) plan to forge a new automotive powerhouse by taking over Porsche in two steps, a separate meeting of the luxury sports carmaker board is unlikely to reach a conclusion on the VW merger push.

Instead, a Porsche spokesman said Wednesday that Porsche chief Wendelin Wiedeking would present to Thursday's board meeting his plans for cutting the 10-billion-euro debt wracked up in debt trying to seize control of VW, which is Europe's biggest carmaker.

As result, Volkswagen has turned the tables on Porsche, which has now been forced to abandon an audacious bid to acquire VW, which is Europe's biggest carmaker.

Apart the political tensions unleashed by the merger bid, the Porsche and VW supervisory board meetings are being held against the backdrop of renewed speculation about the prospects of Wiedeking remaining in the driving seat of the legendary Stuttgart-based automotive group.

With this in mind, a decision by the Volkswagen board to back the takeover plan would represent a major victory for the company's supervisory board chairman Ferdinand Piech with the protracted merger battle having triggered a power struggle among the two families controlling Porsche and VW.

Meanwhile, the political tensions unleashed by the merger battle spilled over into the public domain this week with Ernst Pfister, economics minister in Baden-Wuerttemberg, the southern state where Porsche has its headquarters, lashing out at Chancellor Angela Merkel and the northern German state where VW is based.

A grandson of Porsche founder and VW Beetle creator Ferdinand Porsche, the 72-year-old Piech has spearheaded the moves to integrate the two carmakers, which were first outlined in May.

Piech's brother Hans Michel Piech is a Porsche board member. Their cousin Wolfgang Porsche is chairman of the Stuttgart-based Porsche group and has backed Wiedeking who has drawn up an alternative plan for Porsche in the struggle with VW.

This includes securing a deal worth up to 5 billion euros with the oil-rich Gulf state of Qatar to buy a between 10 and 25 per-per-cent stake in Porsche as well as securing a 5-billion-euro capital injection from the carmaker's family owners.

Denying renewed speculation about Wiedeking's future, a Porsche spokesman said the Porsche chief's plan for cutting the carmaker's debt was the key item agenda for Thursday's board meeting.

Company sources say the sports carmaker's board is not expected to finally rule on the VW takeover plan until the end of the month, as a consequence dashing hopes of an early end to the battle over merging the two carmakers.

But according to German media reports, Porsche's production chief Michael Macht is set to take over from Wiedeking as the car group's new head.

A Porsche board member for 11 years, 48-year-old Macht is seen in the German car industry as a Wiedeking protege.

But with his contract as Porsche chief due to run until 2012 and after 16 years in the company's top job, Wiedeking is expected to receive a payout of about 100 million euros should he decide to step aside. This would be the largest so-called golden parachute in German corporate history.

In its drive to gain control of VW, Porsche has built up a stake of nearly 51 per cent in VW. A set of options boosts Porsche's VW holding by up to another 24 per cent.

But the mounting debt levels have forced it to abandon plans for building a 75-per-cent holding in Volkswagen.

Now, under a new VW proposal, the Wolfsburg-based motor vehicle group would pick up an initial 49.9-per-cent stake in Porsche and then buy the rest at a later date at a total cost of about 8 billion euros.

The ownership of the new merged VW-Porsche group would be split between a more-than 50 per cent stake held by the Porsche and Piech families, a 19.9-per-cent stake held by the Qatar Investment Authority and 10 per cent in the hands of the German state of Lower Saxony.

Under the integration plan, VW and Porsche would together forge a carmaker with 10 brands.

This includes VW's nine brands from premium saloons such as Lamborghini and Bentley through to its more mass market brands such as Skoda and its flagship Volkswagen. Porsche will be the 10th brand in the new group. (dpa)