Though rumored for years, Volkswagen Group has now finally confirmed its interest in taking its Porsche subsidiary public.
VW Group on Tuesday said it was in “advanced discussions” regarding an initial public offering of Porsche.
The talks are primarily between VW AG's board and the board of its main shareholder, Porsche SE, the holding company majority owned by the Porsche and Piech families, and which owns 31.4% of VW Group and has 53.3% of the voting rights. A final decision on the IPO will require the approval of both boards.
It's rumored that the Porsche and Piech families may sell some of their shares in VW Group in order to purchase shares in a public Porsche, in an effort to regain their direct ownership in the sports car manufacturer, which they lost during Porsche's failed takeover of VW Group in the years leading up to the global financial crisis.
Porsche headquarters in Stuttgart, Germany
VW Group is currently undertaking ambitious electric vehicle and software development programs, and a spinoff of Porsche, or more likely just a part of it, could raise some of the multiple billions required.
In 2018, Porsche Chief Financial Officer Lutz Meschke floated the idea of an IPO during a media event for the launch of the Taycan, claiming that Porsche could be valued at up to $80 billion. It's likely the valuation would be even higher today, given the investment focus on automakers offering electric vehicles.
We've seen a number of automakers go public in the past couple of years, either via IPOs or SPAC deals. Some have been quite successful, such as the IPO of Rivian and the SPAC deal of Lucid.
VW Group was also recently rumored to be looking at a spinoff of its Lamborghini subsidiary, though the automaker in 2020 said it will keep Lamborghini along with Bentley and Ducati. It did however transfer in 2021 the ownership of Bugatti to a new joint venture split 45/55 between Porsche and Croatian EV technology company Rimac.