In what will be the second-largest initial public offering (IPO) in the history of Germany, Volkswagen stated on Sunday that it is aiming for a valuation of up to 75 billion euros ($75.1 billion) for premium sportscar producer Porsche.
At the upper end of the range, first reported by Reuters, it would become Europe’s third-largest IPO on record, according to Refinitiv data. Trading will begin on the Frankfurt Stock Exchange on Sept. 29, Volkswagen said.
As part of the listing, 911 million Porsche shares will be divided into 455.5 million preferred shares and 455.5 million ordinary shares. Up to 113,875,000 preferred shares, carrying no voting rights, will be placed with investors over the course of the IPO.
The sovereign wealth funds of Qatar, Abu Dhabi and Norway as well as mutual fund company T. Rowe Price will subscribe up to 3.68 billion euros worth of preferred shares as cornerstone investors, at the upper end of the valuation, Volkswagen said.
“We are now in the home stretch with the IPO plans for Porsche and welcome the commitment of our cornerstone investors,” Volkswagen Chief Financial Officer and Chief Operating Officer Arno Antlitz said.
In line with Volkswagen’s agreement earlier in September with its largest shareholder Porsche, 25% plus one ordinary share in the sportscar brand, which do carry voting rights, will go to Porsche at the price of the preferred shares plus a 7.5% premium.
Porsche, the holding firm controlled by the Porsche and Piech families, will finance the acquisition of the ordinary shares with debt capital of up to 7.9 billion euros, it said in a separate statement.
Total proceeds from the sale will be 18.1 billion to 19.5 billion euros. If the IPO goes ahead, Volkswagen will call an extraordinary shareholder meeting in December where it will propose to pay 49% of total proceeds to shareholders in early 2023 as a special dividend.
According to recent reports, HFZA and Rafid Automotive Solutions collaborated to develop an integrated technical centre inside the free zone that will offer services for car maintenance, inspection, registration, and roadside assistance in addition to repairs and maintenance.
