Volkswagen triggers landmark Porsche IPO plan, defying market doubts

The initial public offering could value Porsche at between €60 billion (S$84 billion) and €85 billion. PHOTO: REUTERS

HAMBURG/FRANKFURT - Volkswagen on Monday announced its intention to float sportscar brand Porsche, triggering what could become one of the world's largest listings even as markets worry over record inflation and a Russia-Europe energy stand-off.

The carmaker published a so-called intention to float for an initial public offering (IPO) in late September or early October to be completed by the year end.

The move was announced after Volkswagen's supervisory board gave the go-ahead late on Monday.

Investors expect a valuation between €60 billion (S$84 billion) and €85 billion.

At the high end of estimates, the IPO could be the largest in German history and the biggest in Europe since 1999, Refinitiv data showed.

"The board of management of Volkswagen AG today resolved, with the consent of the supervisory board, to pursue an initial public offering," Volkswagen said.

It said an IPO would be a significant next step in the transformation of the company as it aims to become a leading provider of software-based mobility.

Qatar will be a cornerstone investor intending to commit to a 4.99 per cent stake in the newly listed company, Volkswagen said.

The intention to float included an offering to retail investors in countries in Europe including France, Spain and Italy, an attempt to tap Porsche’s loyal fan base.

Volkswagen approved a 25 per cent plus one share of ordinary shares in Porsche AG to be sold to Porsche SE, as laid out in a framework agreement by the two parties in February.

This gives the Porsche and Piech families, who control Porsche SE, a blocking minority – bolstering their push for greater control under new chief executive Oliver Blume. REUTERS

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