Volkswagen’s proposed IPO of Porsche AG is making great strides. Yesterday, Volkswagen, parent company of the car manufacturer, announced that the price of the preferred shares offered to the public within the framework of this IPO will be fixed between 76.50 and 82.50 euros per share, i.e. a valuation between 70 and 75 billion euros.
For comparison, it’s much more than Stellantis, resulting from the merger between Peugeot and Fiat Chrysler, and Renault combined. The market capitalization of the first amounts to 41.9 billion euros this Monday morning and that of the diamond brand to 9.2 billion, or just over 50 billion for the two manufacturers combined. It would be, above all, the second largest IPO in Germany and the third ever in Europe, according to Refinitiv data relayed by Reuters.
First listing September 29
As part of the listing, 911 million (a nod to the sports brand’s iconic model) of Porsche AG shares will be divided into 455.5 million non-voting preferred shares and 455.5 million ordinary actions. Only preferred shares will be listed. In total, up to 113,875,000 preferred shares of Volkswagen will be placed with investors during the IPO. This brings the total proceeds of the operation between 18.1 billion and 19.5 billion euros. Negotiations will begin on September 29.
By putting Porsche AG on the stock market, Volkswagen will recover cash to finance its essential shift to electric and highlight the value of its subsidiary. Porsche is already listed on the stock exchange, under the name of Porsche Automobil Holding (Porsche AHSE), it even appears in the Dax index expanded to 40 values a little less than a year ago. This is the controlling holding company which brings together the interests of the Porsche-Piëch families in the Volkswagen group, in which they own 31.4% of the capital. The introduction of Porsche AG will allow the family to regain control of the brand bearing its name, which fell into the hands of Volkswagen in 2012 after a rebounding battle that began in 2005.
49% of the sums received from the IPO
In parallel with the marketing of 12.5% of the capital through preferred shares, the family, through Porsche AHSE will buy a quarter of the ordinary shares, with voting rights (12.5% of the capital) with a premium of 7.5% on the market price of the shares.
For the shareholders of Volkswagen, this IPO will result in an exceptional dividend which will be voted during an assembly which should meet in December. Its amount will correspond to 49% of the sums collected on the introduction of the preferred shares and all of those resulting from the sale of ordinary shares to the Porsche family.
According to Jefferies analysts, the IPO would value Porsche AG at 10.2 times Ebitda.