Diess was succeeded by Oliver Blume, the boss of Porsche, which is the cash cow of the Wolfsburg, Germany-based company.
The automaker has just confirmed its intention to give Porsche its independence through an initial public offering.
That IPO will take place in Frankfurt in late September or early October, the company says.
Volkswagen reminds investors that the transaction is. “subject to further developments in the capital market”. It doesn’t analyze.
“The board of directors and the supervisory board aim for an IPO,” Volkswagen said in a statement that can be found here.
Preferred shares will also be offered to private investors in European countries, an attempt to tap into Porsche’s loyal fan base.
Volkswagen also approved a 25% stake plus one share in Porsche AG common stock to be sold to Porsche SE. That would give the controlling Porsche and Piech families a controlling minority and strengthen their push for a tighter rein on the auto industry.
“In the event of a successful IPO, Volkswagen AG will convene an extraordinary general meeting in December 2022 at which it will propose to its shareholders a special dividend of 49% of the total gross proceeds from the placement of the preferred shares and The sale of the common shares will distributed to shareholders in early 2023,” the company said.
Playing Catchup with Tesla
Investors expect a valuation of 60 billion euros to 85 billion euros ($59.4 billion to $84.1 billion). But some experts also point out that the valuations of other European luxury flagships, such as Ferrari (RACE ) and Aston Martin (AMGDF ) have been greatly reduced.
Ferrari’s market capitalization is currently at $35 billion. But Porsche produces more cars than Ferrari, which plays more on rarity and exclusivity.
If the IPO were valued at 85 billion euros, it would be the largest IPO in Germany and the largest in Europe since 1999, according to Reuters.
Volskwagen’s willingness to IPO Porsche also reflects the two brands’ struggle to catch up with Tesla (TSLA ) in the electric vehicle market.
VW hopes this transaction will provide it with additional capital to accelerate its drive to offer more electric models and develop its own software.
The German manufacturer wants to devote 89 billion euros ($88.1 billion) to the development of electric vehicles over the next five years. The other ambition is for sales of electric vehicles to account for a quarter of the group’s total sales from 2026.
At present, the group sells far fewer electric vehicles than Tesla, the world’s No. 1.
Volkswagen also hopes that by leaving, Porsche will have a freer hand to compete more strongly with Tesla and other luxury electric vehicle makers such as Lucid (LCID ) ,
In 2021, Porsche sold 301,915 vehicles, with 41,296 (down 14%) being the all-electric Taycan. The EV outsold the iconic sports car Porsche 911 (38,464 units). The automaker wants 80% of its sales to be electric by 2030.
