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Volkswagen Considers Listing Porsche as a Stand-Alone Company Through IPO

Ask any car enthusiast what Porsche is, and all of them will have an answer. Ask even those who do not care about cars, and there’s a good chance they’ll also know what that name represents. However, Porsche SE is not the company that makes cars. This is crucial information to understand what the future may reserve for the German brand: an IPO.
Porsche SE and Volkswagen are discussing an IPO to make a Porsche spin-off 7 photos
Photo: Porsche
Porsche passenger car lineupPorsche passenger car lineupPorsche passenger car lineupPorsche passenger car lineupPorsche passenger car lineupPorsche passenger car lineup
Both Volkswagen and Porsche SE released statements saying that they are discussing spinning off Porsche as an independent carmaker by making an initial public offering of its shares. Only 25% of the shares would be traded, ensuring that Volkswagen and Porsche SE still retain control of the company.

That’s something similar to what FCA did with Ferrari in 2015. After announcing intentions to make Ferrari a separate entity in October 2014, FCA created Ferrari N.V. and sold 10% of its common shares on the New York Stock Exchange. The left stocks were distributed among FCA shareholders.

According to Automotive News, that move is not only a way to increase value for shareholders. Its primary purpose would be to offer Volkswagen a new funding option. By selling 25% of Porsche’s shares, the German group would have access to more money to invest in electrification.

Bloomberg Intelligence estimates that the emerging company could reach a value of up to €85 billion – or around $96.5 billion at the current exchange rate. Volkswagen’s current market cap is $129.5 billion.

Porsche SE was born when the Porsche family tried to take over Volkswagen in 2009. It created Porsche SE as a holding for that purpose in 2007 and started buying Volkswagen Group shares. In 2009, the international financial crisis left Porsche SE with €10 billion in debt.

To prevent bankruptcy, the company made a deal with Volkswagen to receive funds in exchange for the automotive part of the business. Porsche SE remained an independent company, owned by the Porsche and Pïech families. Eventually, Porsche SE got 50.73% of voting rights at the Volkswagen Group, making the holding controlled by these families its largest stakeholder.
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Editor's note: The gallery presents images of Porsche vehicles.

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About the author: Gustavo Henrique Ruffo
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Motoring writer since 1998, Gustavo wants to write relevant stories about cars and their shift to a sustainable future.
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