Porsche's state aid bid rejected

Porsche owns more than 50% of Volkswagen

German carmaker Porsche has had its request for a 1.75bn euro loan ($2.47bn; £1.49bn) turned down by the state-controlled bank KfW.

The company has been struggling to finance the 9bn euros of debt it took on as part of its attempts to gain full control of Volkswagen.

Porsche owns more than 50% of VW, but suspended attempts to buy a controlling stake of 75% when it ran out of money.

It has said it will now seek alternative sources of funding.

"Porsche has always stated that the loan was to be an operating loan not in any way burdening the German taxpayer," the company said in a statement.

Had Porsche succeeded in controlling VW, it could have used the larger company's financial muscle to refinance its debt.

Having failed to do so, the company has been forced to look for other forms of funding, including the option of selling a stake in itself to the Qatar Investment Authority.

KfW has told Porsche that it is welcome to contact the bank at any time with another application for a loan.

But Porsche said: "In the interest of the company's credibility, Porsche will however not resort to this offer."