Europe's top stocks have moved into positive territory by lunchtime, with Volkswagen up more than 12% after Porsche raised its stake in the carmaker to a majority.
Luxury sportscar maker said it now holds more than 50% in fellow German auto manufacturer and plans to up its stake to 75% later this year.
Stuttgart-based Porsche now holds 50.76% of the shares in the world's third-largest carmaker, up from 42% previously.
As a result, Porsche is obliged to make a takeover offer for truck maker , in which VW is the dominant shareholder. The group said it has no strategic interest in the Swedish company and will only offer the minimum price for the shares that is prescribed by law.
Elsewhere in the sector, is to halt production at its Japanese plants for 11 days in February and March to reduce its stock of unsold vehicles. The Japanese car firm will stop output for six days in February and five days in March, according to reports.
Toyota, which saw sales in the US drop 37% in December, said the suspension will affect its 12 directly operated plants, including four car assembly plants and other factories that make engines, transmissions and other parts.
In the pharmaceuticals sector, is one of the main risers in Paris, while rivals and are also up.
Across the markets, the German DAX gained 77 points to 5,061 the French CAC is up 40 points at 3,400, while the Swiss market rose 90 points to 5,846.
On the downside, is down after Merrill Lynch slashed its recommendation on the German retailer to "underperform" from "buy".
In economic news, euro zone inflation has dropped to its lowest level in more than two years, raising expectations that the European Central Bank will continue to cut interest rates.
Inflation is expected to be 1.6% in December compared with 2.1% in November, according to a flash estimate issued by European Union statistics office Eurostat, well below the ECB's target rate of just under 2%.
