Volkswagen will value Porsche shares at between €76.50 and €82.50, German group announced on Sunday, leading to a partial IPO that will place a value for the historic sports car brand at 70 billion euros – 75 billion euros – in the middle of analysts’ expectations.
The flotation 12.5% Porsche, scheduled for September 29 in Frankfurt, will provide 8.7 billion euros – 9.4 billion euros for the brand’s parent company. VW says it will use nearly half of the proceeds to pay a one-time special dividend, while the rest will be deployed to help the automaker pay for its transition to battery technology. .
Some €3.8 billion worth of shares has been earmarked for a combination of backers: the Qatar Investment Authority and a major shareholder VW intends to buy back nearly 2.5% of Porsche, along with with Norges Bank, the investment firm T Rowe Price, and ADQ, the sovereign fund of Abu Dhabi. The last three pledged to subscribe to non-voting shares worth 750 million euros, 750 million euros and 300 million euros, respectively.
VW Chief Financial Officer Arno Antlitz said: “We are currently in the house with plans for an IPO for Porsche and welcome the commitment of our platform investors.
As part of a partial IPO, which will become one of the largest in Europe, Porsche-Piëch family, is a fixed shareholder of VW, will purchase an additional 12.5% stake in Porsche, with a premium of 7.5% on the price of the shares offered to the public. The group of families will have voting rights.
Depending on the final offering price for the IPO, the proceeds from the sale of shares to the Porsche-Piëch family, who lost direct control of the patriarch’s company when VW acquired Porsche in a bid. reverse takeover in 2012 – will bring in an additional €9.4 billion- €10 billion. Nearly half of these will be distributed as special dividends to Volkswagen shareholders, including families.
Porsche SE, the investment vehicle of Porsche-Piëch, says it will finance the acquisition of Porsche shares with debt capital of up to €7.9 billion.
Analysts have calculated that the long-awaited Porsche IPO could reach a valuation for the profitable brand of between 60 and 90 billion euros. However, bankers who worked on this selection said the offering would be subject to a “CG discount” of 30-40%, with investors disapproving. complication on the management and ownership structure of Volkswagen and Porsche.
The Recent replacement of Volkswagen CEO Herbert Diess with Porsche boss Oliver Blume, who will retain both roles, also raised concerns among shareholders. They questioned whether the deal deviated from VW’s stated goal of giving the 911 maker more “freedom of business” through an IPO.
A full prospectus is expected to be published on September 19.