German automotive giant Volkswagen said it is drawing up plans to list its luxury brand Porsche as it looks to raise the funds for its move to electric vehicles (EVs).
Shares in Volkswagen jumped as much as 10% on the news, closing 7% higher on Tuesday at 187.94 euros ($213.19).
Volkswagen and its largest shareholder Porsche SE, which manages the investments of the Porsche-Piech family, said a “final decision” on the future of the storied sportscar brand had not yet been taken, the group said.
The flotation would represent a major shake-up at Volkswagen, which is searching for a ways to finance its shift away from traditional combustion engines towards EVs.
The group plans to put 25% Porsche shares on the Frankfurt Stock Exchange, where Volkswagen is listed.
Boards’ Consent Required
Analysts value Porsche at 60-80 billion euros. Under German law, the consent of the two parties’ supervisory boards would be required for the deal to go through.
But approval seems likely given the familial ties between the two groups and the fact that a number of members of the carmaker’s supervisory board also have roles at the holding company.
The Volkswagen group – whose 12 brands also include Audi and Skoda – is pumping 35 billion euros into the shift to EVs and aims to become the world’s largest electric carmaker by 2025.
The world’s second largest automaker is in a tussle with its American rival Tesla, which is building a factory in Germany.
Herbert Diess, the German group’s CEO, has sought to overhaul the group’s image, turning it from an automotive behemoth into a more of a technology company focused on EVs.
As part of the shake-up, Volkswagen introduced its bus and truck subsidiary Traton onto the stock exchange in 2019 and let go its majority in the niche luxury carmaker Bugatti last year.
- AFP, with additional editing by George Russell
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