Despite the gloomy environment surrounding the current market, especially for initial public offerings (IPOs), Porsche’s IPO hasn’t gone wrong. At least, until now.
On its first day as a public company, this Thursday, September 29, the shares of Porsche are trading more than 3.5 percent above the asking price.
For now, the Volkswagen group, a holding company of which Porsche is a part, celebrates having obtained the support of investors who seek to keep a portion of one of the most important luxury sports car brands in the world.
Porsche’s stock market debut contrasts with a gloomy global market for initial public offerings.
Suffice to say, the total value of IPOs is down 70 percent globally (down to $135 billion so far in 2022) from the same period last year, according to data from Dealogic.
The drop in interest in IPOs is due, on the one hand, to the volatility of shares, something that makes it difficult to correctly value companies. On the other, due to the poor performance of the companies that have been listed recently.
It’s official: #Porsche is now listed on @BoerseFrankfurt! #PorscheIPO #ListedInFrankfurt
Learn more here: https://t.co/XUv4ynnJUV pic.twitter.com/TOw7EmAV3g— Porsche Newsroom (@PorscheNewsroom) September 29, 2022
Porsche shares opened at 84 euros each in early trading on Thursday in the frankfurt stock exchange2 percent above the IPO price (82.50), although they immediately rose to 86 euros.
With those values, Porsche has a market value of around €75.7 billion.
At that value, Porsche ranks as one of the top five car brands measured by market value, behind its own parent company Volkswagen, which retains a 75 percent ownership stake, and ahead of its German rival. Mercedes Benz.
Tesla is the best valued in the sector: 886 billion dollars, followed by Japan’s Toyota.
The IPO was designed, in part, for Porsche family heirs to regain some control over the company after the then-independent luxury brand failed to acquire VW more than 10 years ago.
The offer, which includes a private placement of voting shares to the family – separate from the IPO – gives members the power to block important strategic Volkswagen decisions with which they disagree.
At the same time, the IPO enhances Porsche’s value and gives it greater independence in pursuing its own electric-car strategy.
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