Volkswagen is targeting a valuation of up to 75 billion euros ($75.1 billion) for luxury sports car maker Porsche, it said on Sunday, in what would be Germany’s second-biggest initial public offering (IPO) in history.
Volkswagen ( VLKAF ) will price Porsche AG’s preferred shares at 76.50 to 82.50 euros per share, the automaker said, translating to a valuation of 70 billion to 75 billion euros.
At the higher end of the range, it would become Europe’s third-largest IPO on record, according to Refinitiv data. Trading will begin on the Frankfurt stock exchange on September 29, Volkswagen said.
As part of the listing, 911 million shares of Porsche AG will be divided into 455.5 million preferred shares and 455.5 million common shares. Up to 113,875,000 non-voting preferred shares will be offered to investors during the IPO.
The sovereign wealth funds of Qatar, Abu Dhabi and Norway and mutual fund firm T. Rowe Price will subscribe for up to 3.68 billion euros worth of preferred shares as corner investors, at the upper end of the valuation, Volkswagen said.
“We are now at home with the IPO plans for Porsche and welcome the commitment of our fundamental investors,” said Volkswagen Chief Financial Officer and Chief Operating Officer Arno Antlitz.
Under Volkswagen’s deal earlier in September with Porsche SE’s largest shareholder, 25% plus one common share of the sports car brand, which carry voting rights, will go to Porsche SE at the price of the preferred shares plus a 7.5% premium .
Porsche SE, the holding company controlled by the Porsche and Piech families, will finance the acquisition of the common shares with debt capital of up to 7.9 billion euros, it said in a separate statement.
The total proceeds from the sale will be 18.1 billion to 19.5 billion euros. If the IPO goes ahead, Volkswagen will call an extraordinary shareholder meeting in December, where it will propose paying 49% of total proceeds to shareholders in early 2023 as a special dividend.
A stock exchange prospectus is expected to be published on Monday, after which institutional and retail investors will be able to subscribe to Porsche shares.
