Volkswagen has given the go-ahead for the IPO of the sports car subsidiary Porsche. The executive board had decided, with the approval of the supervisory board, to aim for an IPO for the preferred shares of Porsche AG and their listing on the regulated market of the Frankfurt Stock Exchange, the carmaker announced on Monday evening. Volkswagen gave the end of September/beginning of October as the date, but subject this to further developments on the capital market.
With this, Volkswagen gave the green light to tackle one of the largest IPOs in Europe in recent years. The Reuters news agency had previously reported on the upcoming decision, citing an insider. This means that VW can now advertise to investors to buy the shares. Up to 25 percent of the non-voting preferred shares – that is 12.5 percent of the share capital – of Porsche AG are to be placed on the stock market in the next few weeks. It usually takes around four weeks from the official announcement to the first listing.
In the event of a successful IPO, Volkswagen intends to invite shareholders to an extraordinary general meeting in December 2022 to vote on a special dividend of 49 percent of the total proceeds from the placement of preferred shares and the sale of common shares to shareholders in early 2023.
Whether the IPO, worth billions, will ultimately be realized despite the turbulence on the financial markets depends on whether and at what price investors are willing to buy Porsche shares. Critics warn Volkswagen against an IPO in uncertain times. Investors then often keep their money together. However, Volkswagen is likely to have already reached agreements with major investors to secure the placement. According to financial circles, VW and Porsche are aiming for a valuation of 60 to 80 billion euros, with the sale of the preferred shares bringing in 7.5 to 10 billion.
The major shareholder of the Wolfsburg car group, the family holding company Porsche SE, also wants to acquire 25 percent plus one share of the voting ordinary shares in the earnings pearl Porsche AG. For this, Porsche SE is to pay 7.5 percent more than the issue price of the preferred shares. The cheaper these are sold, the less the owner families Porsche and Piech would have to pay. With the transaction, they would regain direct access to Porsche AG, which they lost to Volkswagen after the takeover battle ten years ago. After the IPO, Volkswagen would hold 75 percent minus one share in the total capital of Porsche AG.
