Porsche AG should go public in the fall if possible. From the end of September or the beginning of October, some of the Volkswagen subsidiary’s paper could be traded on the financial market, as VW announced on Monday evening after consultations with the board of directors and the supervisory board.
The aim is a listing in Frankfurt, the new issue could be fully implemented by the end of the year. These steps are planned “subject to further capital market developments”, it said.
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The Wolfsburg group and the Porsche parent company Porsche SE (PSE) had been examining the IPO since February. Europe’s largest car manufacturer wants to tap into additional sources of money. He hopes for an increase in value and wants to use the proceeds to pay for further investments worth billions.
In detail, the capital of Porsche AG is divided equally into non-voting preference shares and voting ordinary shares. Up to a quarter of the preferences – i.e. about an eighth of the total shares – should then go on sale.
At the same time, the PSE gets 25 percent plus one share of the stock, and has a blocking minority to influence important AG decisions.
The Stuttgart-based company has long been a pearl of profitability in the multi-brand group. The operational business with models such as the 911, Cayenne, Macan, Panamera and Taycan is bundled in Porsche AG. In contrast, PSE, controlled by the Porsche and Piëch families, holds most of the voting rights in Volkswagen.
Volkswagen and PSE had previously pointed out that the concrete implementation of an IPO was “subject to market developments”. In particular, the consequences of the war in Ukraine, the sharp increase in energy prices worldwide and new problems in the supply chains made it difficult for companies to determine a suitable point in time. However, the current decision now marks a chronological specification.
As the third most important VW owner, the major shareholder Qatar has “expressed strong interest” and could receive almost 5 percent of the Porsche advantages, according to VW. But private investors in Germany, Austria, Switzerland, France, Italy and Spain should also get a chance.
“In the event of a successful IPO, Volkswagen AG will convene an extraordinary general meeting for December 2022,” VW said. It should propose to shareholders “to distribute a special dividend in the amount of 49 percent of the total gross proceeds from the placement of preferred shares and the sale of common shares to shareholders in early 2023”.
Porsche SE added that its executive board, with the approval of its own supervisory board, had “decided to continue pursuing the transaction and to enter the next phase of preparations”.
A possible walk onto the floor had already been indicated several times. A more detailed plan to examine the project was initiated last winter under the old VW CEO Herbert Diess. His successor, Oliver Blume, who has been in office since September 1, is now to implement the partial IPO – together with VW CFO Arno Antlitz, who also assumes an additional function as “Chief Operating Officer”. Blume will remain head of Porsche AG.
VW is building on getting extra funds for investments in the coffers. A sum in the high double-digit billions is already planned for the next five years, if you take into account the projects for electric cars, software and networking platforms alone.
When assessing the planned start of trading in preferred shares, some analysts recently assumed that Porsche AG would be between 80 and 100 billion euros in a normal market environment. If the entire preferred tranche and thus 12.5 percent of the capital were to be placed, this would correspond to an issue volume of a good 10 billion euros at the lower end of this range.
The Porsche and Piëch families are said to want to give PSE more direct access to the car manufacturer with their name again by restructuring the shares and going public. In 2008/2009, Volkswagen was able to fend off a takeover attack by the then Porsche management.
The Lower Saxony turned the tables and in turn swallowed the profitable subsidiary, the two families got the majority in the car giant in return.