Volkswagen AG is pushing ahead with its plan to list a minority stake in the Porsche sports-car maker despite gyrating markets, paving the way for what could be one of Europe’s biggest initial public offerings.
The manufacturer is planning the initial public offering as early as this month, unless markets worsen significantly, VW said late Monday, targeting to finalize the listing by the end of the year. The move will direct funds to Europe’s biggest carmaker to foot the staggering cost of electrification and software development and return greater influence to the billionaire Porsche-Piech clan over the luxury automaker.
“We have shown a huge resilience especially in crisis times,” VW and Porsche Chief Executive Officer Oliver Blume said Tuesday on a call with reporters. “Looking back on the corona crisis, the semiconductor crisis, this year with the Ukraine conflict, we always have been able to show very high profit margins and we think this will be very convincing.”
The listing will give the Porsche and Piech family greater sway at their former company, some 13 years after they were forced to sell the sports-car business to Volkswagen. More than a decade ago, the family business Porsche Automobil Holding SE tried to take over control at the much-larger Volkswagen, but the bold move that saw emotions run high failed when funding dried up during the financial crisis.
Following the complex minority share sale, which has triggered governance concerns, the family is set to emerge with a blocking stake of 25% plus one share with voting rights. Other investors can invest in preferred shares without voting rights.
Volkswagen’s preferred shares rose as much as 3.9% in Frankfurt trading. The company on Tuesday also filed its official intention to float on the Frankfurt stock exchange.
With the IPO, VW hopes to yield funds that will help bolster its ambitious investment plans. While the company generates strong industrial cash flow, VW risks losing out to the ambitions of deep-pocketed tech companies like Alphabet Inc. and Apple Inc. keen to stake a claim on growing digital revenue from the auto industry. The plan to list is contending with some of the most challenging market conditions in years where a slowing economy, rampant inflation and surging energy costs have largely brought public listings to a standstill.
Even as markets crater, Porsche has lined up investor interest for its IPO at a valuation of…
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