In what will be the second-largest initial public offering (IPO) in Germany’s history, Volkswagen stated on Sunday that it aims to value Porsche at up to 75 billion euros ($75.1 billion).
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.
According to Refinitiv data, at the upper end of the range, first reported by the media, it would rank as the third-largest IPO in Europe ever. 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 up to 3.68 billion euros worth of preferred shares.
Arno Antlitz, chief financial officer and chief operating officer of Volkswagen, stated that the company was “now in the home stretch” with its plans for the IPO of Porsche.
According to the arrangement Volkswagen reached with Porsche SE (PSHG p.DE), the sportscar brand’s largest stakeholder, earlier in September, 25% plus one ordinary share, which do have voting rights, will be acquired by Porsche SE at the price of the preferred shares plus a 7.5% premium.
According to a separate announcement made by Porsche SE, the holding company owned by the Porsche and Piech families, loan capital up to 7.9 billion euros will be used to finance the purchase of the ordinary shares.
The deal will bring in between 18.1 billion and 19.5 billion euros overall. If the IPO goes through, Volkswagen will summon an extraordinary shareholder meeting in December and propose to distribute 49% of the total proceeds as a special dividend to shareholders in early 2023.
Following the release of a stock market prospectus on Monday, institutional and individual investors will be able to subscribe for Porsche shares.