Volkswagen tip to collect up to € 9.4 billion since the IPO of its iconic brand Porsche, in what could be the largest European listing in more than a decade.
The sports car maker said on Sunday that the goal is to achieve a valuation of between 70 and 75 billion euros since the IPO, below a previous high-end target by well 85 billion euros, the operation goes on in a moment of great difficulty on the stock markets. 2022 was a very complicated year for European prices, as most companies avoided similar transactions due to extremely volatile market conditions due to the energy crisis and central banks struggling with interest rate hikes. Volkswagen shares have fallen by 20% since the beginning of the year and are currently priced at € 143.92 per share.
Despite the stock market crash, Porsche’s listing is enjoying strong investor interest like Qatar Investment Authority, the Norwegian sovereign wealth fund, T. Rowe Price and ADQ. According to the auto manufacturer’s announcement, all the companies mentioned above intend to subscribe preference shares for the value of 3.7 billion eurosthe manufacturer said.
“We are grappling with plans for Porsche’s IPO and welcome the commitment of our major investors”he has declared Arno faceCFO of Volkswagen.
Debut scheduled for September 29th
The offer period will start on September 20, while thestart of negotiations and scheduled for 29 September.
According to Jefferies, halfway through the valuation of the preferred stock, the IPO would value Porsche 10.2 times the earnings (before interest, taxes, depreciation and amortization). This compares to Ferrari’s EBITDA multiple of 23.1 times.
However, Porsche’s top valuation range nearly matches VW’s total market value, which includes Audi, Skoda, the VW brand and Seat of 88 billion euros.
Investors will be able to subscribe for 25% of the preferred shares
In addition to offering investors a sizable chunk of one of the most recognizable names in the automotive industry, the Porsche listing will return significant decision-making power to the Porsche-Piech family, which lost control of the auto company more than a decade ago after a long battle. with Volkswagen.
The billionaire family owns the 53% of the shares with voting rights of Volkswagen through the Porsche Automobile Holding Listed separately, Porsche’s IPO is complex and has triggered governance issues that mirror those over VW’s convoluted structure.
Investors will be able to subscribe to the 25% of the preferred shares of Porsche, which do not carry voting rights. The Porsche-Piech family will purchase 25% plus one of Porsche’s common stock with voting rights, which means it will receive a minority blocking share and influence future key decisions.
The family has agreed to pay a premium of 7.5% more than the price range for the preferred stock and plans to finance the acquisition with a mix of debt capital of up to € 7.9 billion and a special dividend. paid by VW.
Although interest in the IPO is high, according to some investors the appointment of Oliver Blume as CEO of Porsche, currently at the helm of Volkswagen and his dual role raises questions about Porsche’s future independence.