Connect with us

Hi, what are you looking for?

Business

Volkswagen eyes separate stock market listing for Porsche

Volkswagen said it was drawing up plans to list its luxury brand Porsche as it looks to raise the funds for its move to electric vehicles.

The need for cash to fund electrification plans is pushing carmakers into share listings for luxury brands
The need for cash to fund electrification plans is pushing carmakers into share listings for luxury brands - Copyright AFP TIMOTHY A. CLARY
The need for cash to fund electrification plans is pushing carmakers into share listings for luxury brands - Copyright AFP TIMOTHY A. CLARY
Sebastien ASH

German auto giant Volkswagen on Tuesday said it was drawing up plans to list its luxury brand Porsche as it looks to raise the funds for its move to electric vehicles.

Volkswagen and its largest shareholder Porsche SE had “negotiated a framework agreement which should form the basis for further steps” towards a separate stock market listing, the carmaker said in a statement.

A “final decision” on the future of the storied sports car brand had not yet been taken, the group said.

The flotation would represent a major shake up at Volkswagen, which is searching for a ways to finance its shift away from traditional combustion engines towards electric vehicles.

According to the daily Handelsblatt, Volkswagen could be willing to part with 49 percent of Porsche shares, which it currently holds in their entirety.

Volkswagen group’s parent company and main shareholder is Porsche SE, which is also listed on the Frankfurt Stock Exchange.

Shares in both the carmaker and the holding company jumped on the news. Volkswagen shares were up almost nine percent to 190 euros ($216) around 1330 GMT, while the holding group’s stock rose by over 12 percent.

– Blockbuster deal –

Analysts value Porsche, maker of the famous 911 sports car, at between 60 and 80 billion euros.

The blockbuster deal could see the similarly named holding company directly “purchase stock in Porsche AG”, it said in a statement.

Porsche SE, which manages the investments of the Porsche-Piech family, could in turn finance the move by selling part of its majority stake in the Volkswagen group, according to recent reports in the local press.

The consent of the two parties’ supervisory boards is still needed for the deal to go through.

But approval seems likely given the familial ties between the two groups and the fact that a number of members of the carmaker’s supervisory board also have roles at the holding company.

The Volkswagen group — whose 12 brands include Audi, Porsche and Skoda — is pumping 35 billion euros into the shift to electric vehicles and aims to become the world’s largest electric carmaker by 2025.

The world’s second largest automaker is in a tussle with its American rival Tesla, which has parked its tanks on Volkswagen’s lawn by building a factory in Germany.

Herbert Diess, the German group’s CEO, has sought to overhaul the group’s image, turning it from an auto behemoth into a more of a technology company focussed on electric vehicles.

As part of the shake-up, Volkswagen introduced its bus and lorry subsidiary Traton onto the stock exchange in 2019 and let go its majority in the niche luxury carmaker Bugatti last year.

AFP
Written By

With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

You may also like:

Entertainment

On Saturday, November 9th, Nick Carter of the Backstreet Boys brought his 2024 "Who I Am" tour to The Cabaret Theatre at Mohegan Sun...

Business

The enormous economic polarization in the US is hardly a secret. The rich, 1 to 10%, are far wealthier than the rest.

Life

Glassblowing is an ancient craft that can be used to create a variety of wondrous objects, from the functional to the purely aesthetic.

Entertainment

Nick Bateman and Jen Lilley in 'Operation Mistletoe.' Photo Courtesy of Hulu.Actors Nick Bateman and Jen Lilley star in the new holiday rom-com “Operation...