Porsche debuts on the stock market with a valuation of $72 billion

The Volkswagen Group and the Porsche-Piech family, majority shareholders of the consortium, will distribute the shares with voting rights.

Oliver Blume, CEO of  Porsche and the  Volkswagen Group, and  Lutz Maschke, financial director of the German brand, have rung the bell on the  Frankfurt Stock Exchange, where the sports and luxury car firm started trading this Thursday with a market value of  75 billion euros.

Porsche shares have started trading at the highest price expected, about  82.50 euros per share, due to the high demand registered during the days before the  Public Offering for Sale (OPV)  this Thursday. The Volkswagen Group expects to raise 9,390 billion euros with the operation, which will be used mainly for the electrification of its brands. Blume and Maschke have defined Porsche’s listing on the Frankfurt Stock Exchange as a “historic moment” in the largest German IPO in 25 years.

The target value of  Porsche AG, the aforementioned  75,000 billion euros, would bring the company closer to the current valuation of the Volkswagen Group, which is around  84 billion euros, and would place it well above direct rivals such as  Mercedes-Benz AG  (56,030 billion) or  Ferrari  (37,010 billion).

During the  IPO, up to 113.9 million shares will be sold, with an initial offering of 99.02 million common shares and 14.8 million preferred shares. Porsche Automobili Holding,  owned by the  Porsche-Piech family and majority shareholder of the Volkswagen Group, will acquire  25% plus one of the common voting shares for the placement price of the preferred shares plus a  7.5% premium to consolidate its control in the company, although the  Volkswagen Group will continue to have a majority stake in the brand – the rest of the shares with voting rights – and will include it in its financial reports.

Oliver Blume (right) and Lutz Maschke ringing the bell in Frankfurt
Oliver Blume (right) and Lutz Maschke ringing the bell in Frankfurt

In addition to big names, some confirmed as  T. Rowe Price, ADQ, the Qatar Sovereign Investment Fund, or the  Norwegian Government Sovereign Fund, private investors from Germany, Austria, Switzerland, France, Italy, and  Spain will also be able to buy shares. For Spanish investors, the bank in charge of placing the titles of the German manufacturer is  Santander.

Porsche‘s  IPO comes at a difficult time for the markets, which are suffering from inflation and an international context of uncertainty, as well as at a delicate time for the automotive sector due to the chip and component supply crisis. Some defined this operation as a way to test the attractiveness of one of the most prestigious brands in a key sector in countries such as  Germany or  Spain

From the  Volkswagen Group, they trusted, in this sense, that a stable and consolidated company like  Porsche would be attractive to investors in this context of volatility. “Porsche was and is the pearl of the Volkswagen Group,” Chris-Oliver Schickentanz, chief investment officer at Capital, told  Reuters. “The IPO has shown the value that the market places on Porsche. This, of course, has a positive impact on  Volkswagen shareholders ”, he added about the benefits that the German consortium will obtain to allocate directly to its electrification.

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