Volkswagen shares rose on Monday after the automaker said it was targeting a valuation of up to 75 billion euros ($74. 84 billion) for the Porsche sports car logo, in the potentially third-largest initial public offering in history in Europe.
Porsche aims to attract investors with its strong logo and superior operating margins even as inventories at other luxury carmakers such as Ferrari and Aston Martin have suffered this year from the tumult of European inventory markets.
The valuation announced on Sunday of 70 billion to 75 billion euros is lower than some investors’ estimates of up to 85 billion euros, but still far exceeds the valuation of other German automakers, such as BMW’s 49 billion euros or Mercedes-Benz’s 61 billion.
It is also approaching Volkswagen’s market capitalization of 88 billion euros. The automaker saw its shares rise 3% in premarket trading. A drop in European stocks.
While the IPO may still be pulled out before trading begins on Sept. 29, Porsche AG Chief Financial Officer Lutz Meschke said in early September that this would only happen in the event of new “serious geopolitical issues. “Own valuation driven through the board By highlighting the price of only one of its premium brands, it saw its shares up 3% in pre-market trading, however, at 08:38 GMT they were only up 0. 4% from Friday. near.
Shares of Volkswagen shareholder Porsche Holding SE rose 3. 23 percent, beating Germany’s top-tier DAX index.
Volkswagen announced late Sunday that it would peg the value of shares in Porsche AG’s IPO between 76. 50 euros and 82. 50 euros depending on the share.
A prospectus with additional main points in the directory is expected to be published on Monday afternoon.
The automaker plans to place up to 12. 5% of Porsche’s share capital with investors in the form of similar percentages, which grant voting rights.
Major investors have already claimed only around 40% of the proposed capital: Qatar Investment Authority, Volkswagen’s third-largest shareholder, has committed to buy 4. 99%, while the Norwegian sovereign wealth fund and T. Rowe Price will buy shares for €750 million. according to Sunday’s statement.
ADQ Abu Dhabi will buy shares for 300 million euros.
“Porsche’s IPO is likely to be a maximum success. . . Investors are lining up. If Porsche’s IPO goes well, one can think about putting other parts [of Volkswagen] like Audi on the stock market,” said Arndt Ellinghorst, an automotive expert. The data analyst company said.
Analysts Porsche AG hold shares of Ferrari, which has a market capitalization of 38 billion euros and an operating margin of 24% to 17-18% for Porsche. The German manufacturer is targeting a margin of 20% and is well ahead of electric vehicles.
But some investors have expressed caution about Porsche AG’s complex governance issues, with Chief Executive Oliver Blume at the helm of the sports car maker and Volkswagen Group and Porsche SE retaining a stake.
The underwriting era for institutional investors is expected to run from September 20 to 28, with shares presented to investors in Austria, Germany, Switzerland, France, Italy and Spain.
According to the agreement reached last September between Volkswagen and Porsche SE, 25% plus a common percentage of the sports car brand, whose voting rights of cars, will pass to Porsche SE to the desired percentage value plus a premium of 7. 5%.
Total proceeds from the sale will be €18. 1 billion to €19. 5 billion.
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