The reporter | thank you
Edited | Jiang Yuyue
The world's most profitable luxury car brand is about to IPO.
Germany's Volkswagen Group announced that its Porsche plans to make an initial public offering on the Frankfurt Exchange in Germany at the end of September or early October, and is expected to complete its listing by the end of the year.
According to the Volkswagen Group's estimates, the valuation of the Porsche brand will reach 60-85 billion euros (about 414.8-587.6 billion yuan), which is almost the same as the current market value of the Volkswagen Group. If successful, it is expected to become the largest IPO in German history.
"A historic moment." Porsche CEO Obomus said it would give the brand "a higher degree of independence.".
Soaring
This year's European stock market is cold, and the automotive industry is also facing many problems such as raw material shortages, chip shortages and Russian-Ukrainian conflicts, which may affect Porsche's IPO performance.
Even so, the pre-order order for this IPO has exceeded the total number of shares issued by it, and the subscribers include PRUS and qatar investment authorities, which are listed in the United States; Red Bull Beverage Company and LVMH are also interested in stock subscription, taking the opportunity to enter the high-end automobile manufacturing industry.
The Volkswagen Group also plans to issue preferred shares to retail investors in many European countries, including France, Spain and Italy, to arouse the investment interest of Porsche "iron fans".
Investor enthusiasm continues undiminished. The key reason is that the Volkswagen Group has many strong players, including Volkswagen, Porsche, Lamborghini, Skoda, Bentley, Bugatti and so on. Porsche is one of the most profitable brands.
In the first half of this year, Porsche's revenue was 17.92 billion euros (about 123.4 billion yuan), an increase of 8.5% year-on-year. Net profit reached 3.48 billion euros (about 23.9 billion yuan), an increase of 24.6% year-on-year.
In terms of sales, Porsche sold 145,900 units in the first six months of this year. In the largest Chinese market, its sales reached 40,700 units, accounting for nearly 30%.
Profitability was record high, with return on sales climbing to 19.4% from 16.9% in the same period last year.
Growth has been going on for a long time. Porsche sold more than 300,000 units for the first time in 2021, with sales of 33.1 billion euros and an operating profit of 5.3 billion euros.
During the same period, the Volkswagen Group sold 8.88 million vehicles and generated an operating profit of 19,275 million euros.
In comparison, Porsche contributed 27% of its profits with 3.3% of its sales. The profit margin of the bicycle can reach almost 10 times that of the Volkswagen brand, and the "profit cow" is well deserved.
Moving into electric
"The Porsche IPO was a turning point that further ignited our momentum towards electric vehicles." Former Volkswagen CEO Herbert Diess said.
Diess once admitted at Volkswagen's internal communication meeting that Tesla's leading edge in the software field made him feel a lot of pressure. "We're going to take away a portion of your market share." Dees openly called out Musk on social media.
His goal is that by 2025, Volkswagen will surpass Tesla to become the world's largest electric vehicle manufacturer.
In 2021, the Volkswagen Group announced that it expects to invest 159 billion euros over the next five years, of which 89 billion euros will be used for technologies such as software and electric vehicles, accounting for 56% of the total investment; By 2030, the share of pure electric vehicle sales will rise to 50%.
Volkswagen's high-end hopes for the electric market are pinned on Porsche.
Porsche plans to deliver half of all new vehicles in 2025 to be electrified (both electric and hybrid). In 2030, pure electric models accounted for more than 80%.
Porsche's electrification has already paid off.
In 2019, the million-level pure electric vehicle Taycan was released, equipped with the industry's hot "black technology" 800V fast charging architecture, which can be charged from 5% to 80% of the power in 30 minutes.
In 2021, Porsche delivered a total of 41,296 Taycans, doubling compared to 2020. It accounted for 13.67% of Porsche's total sales, surpassing the popular 911 model in one fell swoop.
Porsche also crosses over to build electric bicycles.
In 2021, the brand cooperated with German brand Rotwild to develop and launch eBike Sport and eBike Cross, with starting prices of $10,700 and $8,549, respectively.
In June, Porsche announced its wholly-owned acquisition of Fazua, a German electric bicycle manufacturer. Fazua focuses on lightweight electric bike units whose drive system can be removed so that there is no additional load when riding alone without power.
Following the completion of the acquisition of Fazua, Porsche acquired the industry's leading light electric motor technology to expand electrification to the next city.
With its frequent efforts, Porsche wants to extend the category and seize the new revenue increment.
Volkswagen Group CFO Arno Antlitz said the Porsche IPO would provide the group with the "significant investment in new technologies" needed to transition to electric vehicles.
The Group will invest US$55 billion in EV-related businesses between 2019 and 2023, including the establishment of a new EV plant in Germany and a six-seat battery plant in Europe.
It is estimated that the Volkswagen Group can withdraw at least 20 billion euros through the equity settlement of porsche IPOs. It was a timely rain.
Go-to-market wrestling
Porsche's "solo flight" is a dream that began 13 years ago.
In 2009, the Porsche Piech family wanted to buy Volkswagen.
Under the management of Wei Dejin, the "strongest professional manager in Europe" and then CEO of Porsche Group, Porsche's shareholding in Volkswagen went all the way up from 31%, and the highest disposable Volkswagen shares reached 74.1%. However, it has not been able to reach the target of 75% of the holding.
In order to complete the acquisition of Volkswagen, Porsche applied to the bank for a credit line of more than 10 billion euros. A global financial turmoil hit the Piech family's dream and carried a huge debt of more than 9 billion euros.
Can't get it and can't lose it, Porsche can only talk about merger with the public. After spending almost 9 billion euros over three years, in August 2012, the Volkswagen Group officially owned 100% of the Porsche brand car business.
In other words, Porsche did not acquire Volkswagen, but became Volkswagen's Porsche. In return, the Piëch family became the largest shareholder of the Volkswagen Group, holding 53% of the shares.
Taking back Porsche has become a family dream of "phoenix nirvana" - there is a plan called "Phoenix" within the Volkswagen Group, that is, a Porsche independent IPO.
Porsche's share capital is divided into two, half of the voting common stock and half of the non-voting preferred shares. Porsche will place a quarter of its preferred shares, or one-eighth of its total shares, to Volkswagen's investors.
Porsche SE will receive 25% plus 1 share of voting ordinary shares, giving it veto power after the IPO and strengthening direct control.
That is, stocks with voting rights are reserved for insiders and shares that are not voting rights for other investors.
In terms of the allocation of funds, the two sides have different ideas.
The Volkswagen Group expects Porsche to raise high financing at a high valuation to support the advancement of the electric vehicle transformation plan. The Piëch family, on the other hand, values direct participation in porsche management, has more say, and does not want the stock issue price to be too high.
In any case, years of grudges will end with Porsche's "solo flight".