Ferrari shares soar after $9.8 billion IPO
A year after Ferrari parent company Fiat Chrysler Automobiles [NYSE:FCAU] first announced that the storied Italian sports聽聽manufacturer and race team would be聽, the initial public offering is finally complete and the shares ready to start trading.
Ferrari鈥檚 shares, which are listed under the apt ticker symbol RACE, start trading later today, with FCA聽聽Sergio Marchionne set to ring the opening bell together with founder Enzo Ferrari鈥檚 son Piero and FCA chairman and Agnelli heir John Elkann.
Just like Ferrari鈥檚 cars, the company鈥檚 shares offered via the IPO were oversubscribed. This allowed Ferrari to price its shares at $52 apiece, the top end of an expected price range. With 17.18 million shares offered, representing about 9 percent of the company, Ferrari鈥檚 listing brought in approximately $893 million for FCA. It means Ferrari has a market capitalization of about $9.8 billion, and when you include some debts that Ferrari will take on from FCA you鈥檙e looking at an聽聽value of approximately $12 billion.
The remaining 91 percent of Ferrari has been passed over to existing FCA shareholders, primarily the Agnelli family-controlled Exor which gets around 25 percent and Piero Ferrari retaining his own 10 percent stake. Such a structure will ensure that control of Ferrari won't change much.
With money raised from spinning off Ferrari, FCA will be able to refinance a multi-billion-dollar investment program that will see numerous new models introduce across the automaker鈥檚 brands, primarily Alfa Romeo, Jeep and Maserati. As previously reported, these brands have聽聽to investors than Ferrari.
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