Shulou(Shulou.com)11/24 Report--

On the morning of Sept. 6, Beijing time, it was reported that German car giant Volkswagen Group announced on Monday that it would allow its sports car brand Porsche to be listed independently. The Porsche listing could create a record market capitalization, making it one of the largest listings in global history.

Volkswagen has announced preliminary plans for an initial public offering of Porsche in late September or early October, with all work completed by the end of the year. Volkswagen also stressed that the listing work and the specific timing depends on changes in the capital market.

According to sources, Volkswagen is likely to extend the planned four-week roadshow (encouraging more investors to buy shares). In addition, if investors are not interested and Porsche's market capitalization falls short of expectations, Volkswagen may also cancel its listing plan.

A source said that Porsche listing is a "technical start", has been laid the groundwork, but there is no guarantee that Porsche's listing bell will ring.

Record-breaking investment institutions estimate that Porsche's market capitalization is between 60 billion and 85 billion euros. Although the Porsche brand is strong, the market capitalization of other luxury car brands, such as Aston Martin and Ferrari, has fallen recently.

According to the upper limit of expected market capitalization, this IPO will be the largest IPO in the history of German capital markets and the largest in European stock markets since 1999.

Qatar, a rich country in the Middle East, is said to be the cornerstone investor in the listing, buying a 4.99 per cent stake in Porsche's listed company.

Volkswagen also plans to issue preferred shares to retail investors in many European countries, including France, Spain and Italy, where Volkswagen hopes to invigorate the Porsche brand's interest in investing in these countries.

Volkswagen also approved a plan for a 25 per cent stake in Porsche AG plus a share to be transferred to Porsche SE, so that the Porsche family and the Pi ë ch family, which control the Volkswagen group, would be given the minority shareholder position of Porsche with veto power and control of Porsche in the future.

Volkswagen said the listing of Porsche was an important step in Volkswagen's transformation. At present, Volkswagen is following the trend of the world, increasing pure tram models and expanding the scale of software.

Porsche has become a world-famous luxury car brand, with a strong brand premium ability, thus becoming the cash cow of Volkswagen Group. The operating profit of the Porsche brand surged 22 per cent in the first half of this year, compared with a drop of 8 per cent for the Volkswagen brand (not the Volkswagen Group), which focuses on the mass market.

Hendrik Schmidt, a corporate governance expert at the listed Volkswagen Group shareholder "DWS" at a dangerous time, said that in the context of the current turmoil in European capital markets, the biggest purpose behind listing is to control the Porsche family and the Piech family to gain greater control of Porsche.

Ingo Speich, an executive at Deka Investments, a shareholder of Volkswagen, said the current capital markets are quite disadvantageous for Porsche to go public. Spacey did not comment on whether his company would buy a stake in Porsche.

Special dividend

If Porsche goes public successfully, Volkswagen will hold a special shareholders' meeting in December and propose a special dividend plan to distribute 49% of Porsche's listing funds to shareholders early next year.

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