Fiat-Chrysler CEO Sergio Marchionne has wasted no time in imposing his will and financial nous on iconic supercar maker Ferrari.
Less than a month after ousting long-term Ferrari president Luca di Montezemolo, Marchionne has pushed through a plan to slice the ultra-profitable Ferrari off from FCA's struggling Italian carmaking operations. Marchionne today announced that Ferrari would be spun off by the end of next year at the latest, with 10 percent of the company being listed on the stock market.
FCA's board announced today that it would spin Ferrari off to become a separate company, with 90 percent of the company to be distributed amongst FCA's current shareholders and the remaining 10 percent listed on either a U.S. or European stock exchange.
The move realizes a long-held ambition of Marchionne's to unlock the value of Ferrari, which di Montezemolo had limited to just 7500 cars a year to guarantee its exclusivity. "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," Marchionne said.
"The Board supports management's determination that this transaction represents FCA's best course of action to support the long-term success of the Group while at the same time substantially strengthening FCA's capital base."
The move unlocks a key piece of the puzzle for FCA's product-development plan, with Marchionne relying on the Ferrari listing to deliver a significant proportion of the funding for its €48-billion turnaround plan. It also means that people who can't afford to buy a new Ferrari can actually buy a share of the Ferrari company.
It will also guarantee that the Italian industrialist Agnelli family, which first invested in Ferrari by purchasing 50 percent of the company in 1969, will be the largest shareholder in the new, independent Ferrari as well. "I am delighted to have taken this additional step in the development of FCA," FCA Chairman and Agnelli scion John Elkann said.
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"Coupled with the recent listing of FCA shares on the NYSE, 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."
Ferrari's current ownership is split between Fiat-Chrysler's 85-percent share, the Middle Eastern investment group Mubadala Development Company's five percent, and Enzo Ferrari's son and current Ferrari vice-Chairman, Piero, who owns 10 percent.
from Car and Driver Blog http://ift.tt/nSHy27
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