Sept. 29 (Bloomberg) -- Shares of Porsche AG rose as much as 2.3 percent after the German maker of luxury sports cars said it owned more than 10 percent of Volkswagen AG's common shares, a stake worth 1.7 billion euros ($2.1 billion).

The purchases were made from ``institutional investors'' and not from Volkswagen, Porsche spokesman Anton Hunger said in a telephone interview today, declining to comment further. Porsche has now acquired 32.9 million vote-bearing Volkswagen shares, or 10.26 percent, the Stuttgart-based carmaker said yesterday.

Porsche announced plans this week to buy a fifth of Wolfsburg, Germany-based Volkswagen, the maker of the Golf hatchback, to protect a strategic partnership between the carmakers. Porsche works with Volkswagen to build the Cayenne sport-utility vehicle.

Porsche may pay as much as 3.3 billion euros altogether for the stake. The purchase averts any danger that Porsche could lose Volkswagen as a partner if a European court overturns the so-called Volkswagen Law that prevents a takeover.

Porsche stock rose as much as 14.48 euros to 656.77 euros and was up 1.7 percent to 653.11 euros as of 10:03 a.m. in Frankfurt.

Volkswagen currently owns 13 percent of its own common shares, making it the second-largest shareholder in the company after the German state of Lower Saxony, which has 18.2 percent. Lower Saxony has said it does not intend to sell its holdings.

Porsche said Sept. 25 it owned less than 5 percent of Volkswagen's common or voting shares. The carmaker, which has reserves of as much as 4 billion euros, has declined to say how it will acquire the full 20 percent stake.

Germany's Volkswagen law, which has been challenged by the European Union, prevents any single investor from having more than 20 percent of the voting rights in the carmaker.

To contact the reporters on this story: Chad Thomas in Berlin at cthomas16@bloomberg.net.

Last Updated: September 29, 2005 04:10 EDT