The deed is finally done–Fiat Chrysler chief Sergio Marchionne has surrendered the company’s remaining 80 percent stake, and management control, of Ferrari. This development officially ranks Ferrari as the most profitable independent automaker out there.
Trading under the RACE ticker on both the New York Stock Exchange (NYSE) and Italian Mercato Telematico Azionario (MTA), Ferrari’s shares are now in the hands of investors. For every 10 shares of FCA, investors are granted one share of Ferrari.
“The separation of Ferrari will preserve the cherished Italian heritage and unique position of the Ferrari business and allow FCA shareholders to continue to benefit from the substantial value inherent in this business,” FCA chairman John Elkann has said in earlier statements about the separation. The initial public offering of ten percent of Ferrari–17.2 million shares–raked in about $9.82 billion.
Marchionne’s decision to spin off Ferrari stems largely from his desire to pool resources and focus on developing the Alfa Romeo and Maserati luxury brands. Bloomberg, however, reports that investors are losing confidence that FCA can meet its aggressive targets, especially in light of declines in Brazilian and Chinese markets.
FCA’s plan to raise $52.1 billion to invest in a plan to grow sales to 7 million vehicles annually relies on growth in the luxury arena, as well as continued expansion of the thriving Jeep brand. Wall Street analysts have estimated that Jeep alone represents some 60 percent of FCA’s value now that it has dropped Ferrari.