No less than three American automakers have either gone public or have plans for initial public offerings, but it seems at least one automaker on the other side of the pond is eying the option. Fiat and Chrysler Group CEO Sergio Marchionne recently announced that he may consider taking Ferrari public.
After selling, and then purchasing back shares of Ferrari in 2002 during a financial meltdown, Fiat is looking to regain a 90-percent controlling interest in Ferrari. Today, it owns just 85 percent. Founder Enzo Ferrari willed ten percent of Ferrari to his son Piero, and Mubadala Development currently owns the remaining five percent. Marchionne addressed questions surrounding the issue at a press conference last week.
“We are looking for a way to permit Fiat to return to controlling 90 percent of Ferrari, our historical stake,” Marchionne said at the conference. When asked about the possibility of an IPO for Ferrari, Marchionne added that “on such a long time frame, I cannot exclude anything.”
If Marchionne does decide to take Ferrari public, it could be a huge cash infusion for Fiat. Ferrari is Fiat’s most profitable subsidiary, bringing in over $320 million with an operating margin of over 13 percent, despite the global economic downturn. Through the first half of 2010, sales were up 20 percent, due in part to the new 458 Italia, California, and 599 GTO according to Ferrari chairman Luca di Montezemolo.
These numbers make Ferrari hugely valuable — according to Morgan Stanley, it’s worth $4.1 billion, more than the combined value of the rest of Fiat’s auto subsidiaries. Morgan Stanley valued the rest of Fiat Auto at $3.9 billion.
Rumors of a Ferrari IPO have persisted for years. In 2005, it was rumored Ferrari was going to spin off Maserati before going public. With Marchionne’s reluctance to rule out a Ferrari IPO with absolute certainty, do you think it’s possible we could own a portion of Ferrari by 2014?
Source: Automotive News Europe (Subscription required)