Fiat Chrysler Automobiles (FCA) plans to spin-off Ferrari S.p.A. and sell 10 percent of the company's shares in an initial public offering. The transactions are expected to take place next year and will separate Ferrari from the remainder of the FCA empire.
"As we move forward to secure the 2014-2018 Business Plan and work toward maximizing the value of our businesses to our shareholders, it is proper that we pursue separate paths for FCA and Ferrari," CEO Sergio Marchionne said in a statement.
FCA said it expects to list about 100 million shares worth about $2.5 billion in total on a U.S. exchange -- likely the New York Stock Exchange -- and may later list shares on a European exchange. The initial public offerings will be detailed before the end of 2014 with the deals set to occur in 2015. The remaining 90 percent of Ferrari shares not listed in the IPO will be offered to existing FCA shareholders, which includes the Agnelli family that founded Fiat. In its third-quarter results released today, FCA said that Ferrari posted net revenue of €662 million ($844 million) last quarter. Ferrari's financial results for the quarter included $18 million in "compensation costs related to the resignation of the former chairman," Luca di Montezemolo.
The move comes on the heels of significant changes both for FCA as a whole and for Ferrari. Machionne helped push out longtime Ferrari chief Montezemolo in part over disagreements about the future of the Ferrari brand within FCA. Earlier this month, FCA was listed on the New York Stock Exchange for the first time, after Fiat and Chrysler completed a merger. Marchionne plans to retire from FCA in 2018 after executing the business's current five-year plan.
"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 said in a statement.
"As we move forward to secure the 2014-2018 Business Plan and work toward maximizing the value of our businesses to our shareholders, it is proper that we pursue separate paths for FCA and Ferrari," CEO Sergio Marchionne said in a statement.
The move comes on the heels of significant changes both for FCA as a whole and for Ferrari. Machionne helped push out longtime Ferrari chief Montezemolo in part over disagreements about the future of the Ferrari brand within FCA. Earlier this month, FCA was listed on the New York Stock Exchange for the first time, after Fiat and Chrysler completed a merger. Marchionne plans to retire from FCA in 2018 after executing the business's current five-year plan.
"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 said in a statement.
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