The price of Porsche IPO per share is expected to hover around €76.50 to €82.50 ($76.35 to $82.34) per share. Should you buy into an eventual Porsche IPO? Could it be one of Europe’s largest IPOs to date? Before we delve further into the nuanced world of IPO investing, let’s first look at some key facts.
On September 18, Volkswagen revealed that it was targeting a valuation of almost €75 billion ($75.1 billion) for the Porsche IPO. It is expected to be Germany’s second largest public offering, despite an unstable economic climate, compounded by an energy crisis in Europe.
According to Refinitiv data, it would be Europe’s third-largest IPO on record. After months of speculation, trading in shares is due to start on September 29 at the Frankfurt Stock Exchange.
What is the Porsche IPO price?
The luxury carmaker will price preferred shares in the flotation of Porsche at €76.50 to €82.50 ($76.35 to $82.34) per share, which brings its valuation between €70 bn to €75 bn ($69.86 to $74.85).
Although the stock market is bearish, the Porsche IPO has gotten a boost from key cornerstone investors. Cornerstone investors are a class of investors who commit in advance to buying a fixed number of shares or invest a fixed amount of money in an IPO. The Porsche stock has attracted the attention of the sovereign wealth funds of Qatar, Abu Dhabi, and Norway as well as mutual fund company T Rowe Price will subscribe up to €3.68 billion ($3.67 billion) worth of preferred shares.
“We are now in the home stretch with the IPO plans for Porsche and welcome the commitment of our cornerstone investors,” Said Volkswagen’s chief financial officer Arno Antlitz. The VW CFO said that the Porsche IPO is proceeding as planned.
Investors can lay their hands on 25% of Porsche stock, which carry no voting rights. People can pre-order Porsche shares before the Porsche IPO through stock brokers.
Does Porsche trade publicly?
The Porsche IPO date has been fixed for September 29. Before subscribing to the Porsche IPO, investors must know the complex structure of the company.
Under the IPO plan, the Porsche-Piech family, which had ceded control of the iconic brand to Volkswagen years ago, will get to purchase shares that will give it significant decision-making powers. In keeping with its earlier agreement, the family will buy 25% plus one of Porsche’s common shares with voting rights, which will give them power over key decision-making in the future. They will pay a premium of 7.5% on top of the price range for preferred shares.
The Porsche-Piech family holds 53% of VW’s voting shares via the separately listed Porsche Automobil Holding SE.
As part of the listing, 911 million Porsche shares will be split into 455.5 million preferred shares and 455.5 million ordinary shares.
The automaker is expected to put up 12.5% of Porsche’s share capital with investors in the form of preferred shares. Preferred stock, or preferred shares are shares of the company’s stock with dividends that are paid out to shareholders before common stock dividends are distributed.
Almost 113,875,000 Porsche preferred shares will be offered to investors as part of the Porsche IPO but contain no voting rights.
How to buy Porsche IPO?
Volkwagen’s stock has declined by close to 35% year-on-year. To buy or not to buy the Porsche IPO is the question. On the other hand, the company has been slowly building up its sales of electric vehicles, with deliveries growing by nearly 27% year-on-year. Volkswagen is set to launch Porsche to build its brand and fuel its electric dreams.
The price of Porsche IPO per share will be between €76.50 to €82.50 ($76.35 to $82.34) for preferred shares per share, announced the carmaker.
A stock exchange prospectus is expected to be published soon, after which institutional and private investors can subscribe to Porsche shares.
The subscription period for private and institutional investors is expected to run from September 20 to 28, with shares offered to private investors in Germany, Austria, Switzerland, France, Italy, and Spain. Most IPOs tend to be oversubscribed and it is next to impossible to get the actual initial price unless one places a pre-order through a brokerage.
Total proceeds from the sale will be around €18.1 billion to €19.5 billion ( $18.06 billion to $19.4 billion).
Although investor interest in the Porsche IPO is high, some experts have raised questions about the company’s independence with the dual roles managed by Oliver Blume, head of VW.
