Volkswagen is targeting a valuation of up to $75.1 billion for luxury sportscar maker Porsche, it said on Sunday. Notably, it will be Germany’s second-largest initial public offering (IPO) in history. According to the automaker, Volkswagen would value its preferred shares at between 70 and 75 billion euros, or 76.50 and 82.50 euros per share, in Porsche AG’s initial public offering.
Trading will start on the Frankfurt Stock Exchange on September 29
According to Refinitiv data, at the upper end of the range, it would rank third among all IPOs in Europe. On September 29, trading will start on the Frankfurt Stock Exchange, according to Volkswagen.
911 million Porsche AG shares will be divided into 455.5 million preferred shares and 455.5 million common shares as part of the listing. Over the course of the IPO, up to 113,875,000 preferred shares without voting rights will be distributed to investors.
As cornerstone investors, at the higher end of the valuation, Volkswagen said that the sovereign wealth funds of Qatar, Abu Dhabi, and Norway as well as mutual fund company T. Rowe Price will subscribe to up to 3.68 billion euros worth of preferred shares.
“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.
Porsche SE will receive 25% plus one ordinary share in the sports car manufacturer
In line with the deal reached between Volkswagen and Porsche SE, its largest shareholder, earlier in September. Porsche SE will receive 25% plus one ordinary share in the sports car manufacturer, which does have voting rights, for the price of the preferred shares plus an additional premium of 7.5%.
According to a second statement made by Porsche SE, the holding company owned by the Porsche and Piech families, loan capital in the amount of up to $7.8 billion will be used to finance the purchase of the common shares.
The transaction will net between $17.9 billion and $19.4 billion in total. Volkswagen will conduct an extraordinary shareholder meeting in December and seek to distribute 49% of the total profits to shareholders in early 2023 if the IPO occurs.