Auto Giant Volkswagen Plans IPO Of Porsche Unit

Despite the current market downturn, German automotive giant Volkswagen (VOW3) says it is
planning to hold an initial public offering (IPO) of its Porsche sports car unit by the end of this
year.

Volkswagen says that an IPO will enable Porsche, a luxury vehicle brand that’s known
worldwide, to operate with more freedom and autonomy.

“We are optimistic we can pursue this project in the fourth quarter,” Volkswagen Chief Financial
Officer (CFO) Arno Antlitz said at an automotive conference held in Munich, Germany. “Porsche
would gain entrepreneurial freedom; we can expect a lot from them.”

When questioned about the timing of the IPO, Antlitz said there is still investor appetite and
capital available for a marquee listing such as Porsche AG.

Porsche is wholly owned by Volkswagen. The two companies began working together in the
1960s and Volkswagen acquired a 49.9% stake in Porsche in 2009 before buying the rest of the
company a decade ago.

Media reports have said that Porsche could target a valuation of up to $100 billion U.S., which
would make it one of Germany’s largest-ever IPOs. However, the final valuation is yet to be
determined and will be made closer to an IPO date.

Volkswagen owns multiple automotive brands, including Skoda, Lamborghini, Ducati, Audi, and
Bentley. Within Volkswagen, Porsche has been one of the most successful brands by focusing
on quality and serving high-end customers.

While Porsche accounted for 3.5% of all the deliveries made by Volkswagen in 2021, the brand
generated 12% of the company’s revenues and 26% of its operating profit.

Volkswagen is hoping that a spinoff of Porsche will raise some cash needed to fund its transition
to electric vehicles.

Volkswagen stock is down 24% this year at EUR137.76 a share.