Fiat Chrysler may sell over 10% of stake in Ferrari

Article by Andrew Christian, on March 6, 2015

Fiat Chrysler Automobiles may sell more than 10 percent of its stake in Ferrari when the division holds an initial public offering this year. According to FCA chief executive as well as Ferrari chairman Sergio Marchionne, the demand for stakes in the supercar manufacturer is “much, much higher” than foreseen. He added that FCA should pay attention to the demand as not to create “imbalances” in the stock price.

FCA outlined last year a plan to sell 10 percent of Ferrari in the IPO, with its remaining 80-percent holdings to be distributed to Fiat Chrysler investors by year’s end. The remaining 10 percent is owned by the son of founder Enzo Ferrari, Piero Ferrari.

Marchionne remarked that increasing the IPO stake beyond 10 percent would trim the risk of high demand artificially pushing up the price of Ferrari’s shares, adding that it will be “very unlikely” that Fiat Chrysler would sell its entire stake.

Ferrari’s spinoff plan include the creation of a holding company registered in the Netherlands for the unit and gearing up for a New York Stock Exchange listing – similar to the move when Fiat merged with Chrysler and when CNH Industrial NV was created.

Should Ferrari be listed in the Netherlands, Fiat’s founding Agnelli family would have tighter grip on Ferrari, as Dutch law allows loyalty-ownership program giving stronger voting rights to long-term shareholders. Marchionne has said that Ferrari may adopt such a program.

The spinoff also entails having public shareholders owning a majority of the equity in Ferrari.

Should the loyalty-owner plan pushes through, Fiat Chrysler Chairman John Elkann and other descendants of Giovanni Agnelli would hold a combined 36 percent of the votes and Piero Ferrari another 15 percent, according to calculations by Bloomberg News.

Marchionne remarked that Ferrari will remain Italian and will pay taxes in Italy, and its vehicles will be still be built in the country.

Topics: fiat, chrysler, ferrari

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