Photo: Catalin Garmacea
January 3, 2016, will go down in history as the day when Ferrari completely separated from Fiat, with the Prancing Horse now being fully listed as a standalone company on both the New York Stock Exchange and Milan's Borsa Italiana.
While certain Ferraristi might be worried about the move, we want to explain why there's no need to fret over this.
First of all, the move doesn't surprise those following the industry. The separation plan started in late 2014, when Fiat Chrysler Automobiles (FCA) made the spinoff decision public. About one year later, Ferrari made its Initial Public Offering (IPO), but only about 10 percent of the company was listed last fall.
While 10 percent of the automaker is still owned by Piero Ferrari, Enzo's son, the remaining 80 percent were destined for exiting FCA shareholders.
This brings us to the present day, with FCA having delivered on its promise to offer the remaining 80 percent to its shareholders. As a result, FCA shareholders received one common Ferrari share for every ten FCA common shares.
Also, those who hold FCA MCS units (Mandatory Convertible Securities) received 0.77369 common Ferrari shares for each MCS unit of $100 in notional amount.
Just as important is the fact that the puppet masters who control the company remain largely the same.
The Agnelli Family (founders of Fiat) remain Ferrari's largest shareholder, with 24 percent of the stock.
Nevertheless, since investors with a rich history receive special privileges, the Agnelli family, together with Piero Ferrari, hold just under 49 percent of voting rights. The two sides ensured any potential hostile takeover is prevented by signing a special agreement back in December last year.
While Ferrari's operations continue to sit at a stratospheric level, we can't say the same about the stock exchange situation. The New York Stock Exchange saw the share price remaining in the $52 area dictated by the IPO, but this has now dropped to $48, which means the company is valued at $9.1 billion (EUR 8.4 million at the current exchange rate).
As for FCA shares, their 2016 price (post-spinoff) sits more than 30 percent below the value seen at the end of 2015.
One of the most important financial questions for Ferrari has to do with the company's annual sales volume. With the carmaker making the transition from the more traditional way of former helm man Luca di Montezemolo to the picture we currently see, which was painted by FCA CEO Sergio Marchionne, it is expected to expand its annual sales volume from 7,000 to 10,000 units.
Those of you who enjoy indulging themselves in the complete details of the spinoff are invited to check out the press release below.
P.S.: Here's a more detailed story on why Ferrari's stock exchange listing is a positive step.
First of all, the move doesn't surprise those following the industry. The separation plan started in late 2014, when Fiat Chrysler Automobiles (FCA) made the spinoff decision public. About one year later, Ferrari made its Initial Public Offering (IPO), but only about 10 percent of the company was listed last fall.
While 10 percent of the automaker is still owned by Piero Ferrari, Enzo's son, the remaining 80 percent were destined for exiting FCA shareholders.
This brings us to the present day, with FCA having delivered on its promise to offer the remaining 80 percent to its shareholders. As a result, FCA shareholders received one common Ferrari share for every ten FCA common shares.
Also, those who hold FCA MCS units (Mandatory Convertible Securities) received 0.77369 common Ferrari shares for each MCS unit of $100 in notional amount.
Just as important is the fact that the puppet masters who control the company remain largely the same.
The Agnelli Family (founders of Fiat) remain Ferrari's largest shareholder, with 24 percent of the stock.
Nevertheless, since investors with a rich history receive special privileges, the Agnelli family, together with Piero Ferrari, hold just under 49 percent of voting rights. The two sides ensured any potential hostile takeover is prevented by signing a special agreement back in December last year.
While Ferrari's operations continue to sit at a stratospheric level, we can't say the same about the stock exchange situation. The New York Stock Exchange saw the share price remaining in the $52 area dictated by the IPO, but this has now dropped to $48, which means the company is valued at $9.1 billion (EUR 8.4 million at the current exchange rate).
As for FCA shares, their 2016 price (post-spinoff) sits more than 30 percent below the value seen at the end of 2015.
One of the most important financial questions for Ferrari has to do with the company's annual sales volume. With the carmaker making the transition from the more traditional way of former helm man Luca di Montezemolo to the picture we currently see, which was painted by FCA CEO Sergio Marchionne, it is expected to expand its annual sales volume from 7,000 to 10,000 units.
Those of you who enjoy indulging themselves in the complete details of the spinoff are invited to check out the press release below.
P.S.: Here's a more detailed story on why Ferrari's stock exchange listing is a positive step.
Google News