Volkswagen is drawing up plans to list Porsche on the stock market in a blockbuster move that will help fund its push into electric cars.
The German car giant said it was in “advanced talks” with its billionaire owners to spin off Porsche in a long-rumoured move that requires the agreement of the family-owned holding company Porsche SE.
Volkswagen is banking on the idea that the Porsche brand will be valued more by investors as a separate entity. That proved to be the case when Ferrari was listed in 2016 by Fiat Chrysler, which is now called Stellantis.
The Italian sports car maker is worth €37bn, while Stellantis is worth €51bn for the Peugeot, Citroen, Fiat, Chrysler, Vauxhall, Opel and Maserati brands combined.
VW is worth about €116bn, while Porsche alone could be worth at least €100bn, according to analysts.
A split would still leave VW with its eponymous brand as well as Audi, Bentley, Bugatti, Seat, Skoda and Lamborghini, along with its motorcycle brand Ducati and truck makers Scania and MAN.
Shares in Volkswagen jumped almost 10pc in Frankfurt, while Porsche SE was more than 12pc higher.
The Porsche family controls Volkswagen and the Porsche brand through a series of holding companies. They own half the shares and all the voting power of Porsche SE, which owns almost a third of the shares and about just over half of the voting stake of Volkswagen AG.
The plan would allow the family to maintain control while raising billions of euros to help finance its challenge to Tesla and become the world’s biggest electric car maker by 2025.
VW aims to spend €52bn electrifying its brands, but additional cash would let the company control more of its supply chain including the manufacture of batteries, which account for a large part of the cost, and thus profitability, of a car.
Production slipped to a 10-year low for Volkswagen in 2021 with 8.9m vehicles. Its upmarket brands such as Audi and Porsche fared far better as VW prioritised them given their higher profit margins.
A “final decision” on a listing has not yet been taken, VW said. However, approval of the plan is expected given the familial ties between the two groups. Several members of the VW’s supervisory board also have roles at the holding company.
Tom Narayan, an RBC analyst, said: “We think a Porsche IPO, which has been a hot topic of discussion for years, is now more of a possibility of actually happening than ever before. What is different now, however, is that the Porsche family is firmly behind it as we expect Porsche SE to be a buyer of a Porsche brand IPO.”
