Shares in Porsche (POAHY) rose in early European trade Monday after Volkswagen (VWAGY) targeted a valuation of the sports car brand Porsche AG by as much as 75 billion euros ($75 billion) in its planned initial public offering.
Volkswagen, the German auto giant, where the Porsche SE – the investment arm of the powerful Porsche-Beech families – is a key stakeholder, said the preferred stock in Porsche would be priced at €76.50 – €82.50, giving it a value between €70 billion and €75 billion. billion euros.
The valuation is in the middle of the €60 billion – €90 billion forecast put forward by analysts ahead of Porsche AG’s partial flotation scheduled for September 29.
The company said in a statement that the IPO will raise 8.7 billion euros – 9.4 billion euros for Volkswagen. Porsche AG’s parent company said it will use the money to pay a special one-time dividend, while any remaining cash will be used in its long-term switch to battery-powered cars.
Several backers have already floated their intentions to buy about 3.8 billion euros of shares in Porsche, including the sovereign wealth funds of Qatar and Abu Dhabi, as well as the Bank of Norway and investment firm TRU Price (TROW).
Meanwhile, Porsche-Pech families will buy 25% plus one additional ordinary stake in Porsche AG at a premium of 7.5% over the holdings price made available to the general public. The stake will also come with voting rights.
By Scott Kanosky