Tag Archive | "ferrari"

Ferrari IPO Filing to Come in Days, Fiat Chrysler CEO Says

Ferrari SpA, the supercar maker being spun off by Fiat Chrysler Automobiles NV, is close to filing for an initial public offering, Fiat Chrysler Chief Executive Officer Sergio Marchionne said, reports Bloomberg.

“We are days away from filing the prospectus,” he told reporters Friday after a panel discussion at the Toronto Global Forum.

Debt-laden Fiat Chrysler is spinning off Ferrari to help fund a 48 billion-euro ($53 billion) investment program that focuses on expanding the Jeep, Alfa Romeo and Maserati brands globally. Ferrari picked UBS Group AG to help manage its IPO in New York later this year, people with knowledge of the matter said this week.

JPMorgan Chase & Co. and Goldman Sachs Group Inc. are also due to play a role in selling 10 percent of Ferrari’s shares to investors, said the people, who asked not to be named before an official announcement.

Marchionne declined to say whether UBS would manage the IPO. Fiat Chrysler may consider a secondary listing for Ferrari, most likely in Milan, he said.

The CEO also said Friday that Fiat Chrysler hasn’t looked at making a hostile bid for General Motors Co. He has been pushing for consolidation, contending that the industry’s profitability even in peak years doesn’t generate enough returns to support investment costs. Potential partners, including GM and Ford Motor Co., have said they’re not interested.

Combining with GM yielded the most theoretical cost savings, Marchionne said.

“There are other, less optimal combinations,” he said.

Shares Rise

Fiat Chrysler rose 3.8 percent to $14.47 at the close in New York, as the broader market also climbed.

Marchionne declined to comment Friday on a valuation for Ferrari. He said earlier this month that he was expecting the unit to be valued “at least” at 10 billion euros, which is equivalent to about 60 percent of the parent company’s market value. That was higher than the 8.7 billion-euro average of four analysts surveyed by Bloomberg News.

Boosting profit is crucial if Marchionne, 63, is to generate sufficient cash to develop the next generation of vehicles and technologies. His only other option is to share the costs by merging with another automaker, which seems unlikely in the short term despite his efforts to cut a deal.

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Fiat Chrysler CEO Sees Ferrari IPO Mid 2015

The initial public offering of luxury carmaker Ferrari is expected to happen between the second and the third quarter of 2015, the chief executive of parent Fiat Chrysler Automobiles (FCA) said on Tuesday, reported Reuters.

FCA CEO Sergio Marchionne said last month he would spin off Ferrari from the group, sell a 10 percent stake via a public offering and distribute the rest of FCA’s stake in the luxury sports car brand to its shareholders.

The spin-off is part of a bigger capital-raising plan that also includes a $2.5 billion convertible bond issue to help cut debt and fund an ambitious business plan at the world’s seventh-largest carmaker.

Marchionne said on Tuesday that after the capital raising the free float of FCA, which moved its primary listing to New York last month, could increase to around 20 percent of the group’s capital. A roadshow to market the capital raising with U.S. investors is planned for December, he added

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Ferrari Should Be Valued At $7.3 Billion In IPO, Marchionne Tells Bankers

Fiat SpA Chief Executive Officer Sergio Marchionne said he’s told bankers pushing him to pursue an initial public offering of Ferrari that the division may be worth more than 5 billion euros ($7.3 billion).

“I’ve always viewed Ferrari as a sacred brand, and sacred brands are peculiar,” Marchionne said in an interview at Fiat’s headquarters in Turin, Italy. “I know I can float Ferrari any time, but there’s nothing on my desk.”

Ferrari, which will next month start delivering its first family car, the $359,000 four-seat FF, is Fiat’s most profitable unit. The sports-car maker’s earnings before interest and taxes rose 23 percent last year to 302 million euros on revenue of 1.92 billion euros.

Marchionne’s valuation of Ferrari is 2 billion euros more than that of analysts and 63 percent of Fiat’s entire market value of 8 billion euros. In addition to Fiat brand cars, the company owns a 30 percent stake in Chrysler Group LLC, as well as the Maserati, Alfa Romeo and Lancia brands.

Bankers are pitching Marchionne, who says he’s ordered a white FF, to list the unit to reduce debt and improve Fiat’s credit rating. Standard & Poor’s lowered its rating on the Italian carmaker to BB from the already junk ranking of BB+ in February, after Fiat spun off the industrial operations from the car business.

Standard & Poor’s said at the time it may downgrade Fiat again if it buys a majority stake in Chrysler in 2011. Marchionne, who also runs the American carmaker, said he has no immediate plan to list Ferrari because Fiat has enough cash to increase its Chrysler holding.

“It’s difficult to give a valuation of sacred brands like Ferrari,” Marchionne said in the April 4 interview, where he chain-smoked Muratti cigarettes and sipped diet raspberry iced tea. “There are days when I think more than 5 billion euros.”

Fiat reversed early gains to close 2.6 percent lower at 6.175 euros in Milan trading. The Italian carmaker has dropped 7.8 percent this year, valuing the company 7.65 billion euros.

Marchionne raised the possibility of a Ferrari IPO last November when he said he may sell assets, including a stake in the sports-car maker, if he needs cash ahead of a full Chrysler merger. Fiat had 12.2 billion euros in cash and cash equivalents at the end of 2010, and net industrial debt of 542 million euros.

Fiat almost halved its debt last year before the spinoff of its industrial businesses. Fiat assumed about 500 million of a total of 2.4 billion euros in debt, with the truck and tractor unit taking on the remaining 1.9 billion euros. Debt will likely rise to between 1.5 billion euros and 1.8 billion euros at end of this year as capital expenditures “are expected to increase substantially” to as much as 4.5 billion euros, Fiat said in January.

Ferrari may be worth 3 billion euros, or about 10 times operating profit, according to the average estimate of four analysts surveyed by Bloomberg.

“Ferrari is a trophy asset inside Fiat,” said Jochen Gehrke, a Deutsche Bank AG analyst who is ranked No. 1 among Fiat analysts tracked by Bloomberg. “Given the profitability it generates, an IPO would attract huge attention.”

Luxury-goods company LVMH Moet Hennessy Louis Vuitton SA trades at an enterprise value of 10.8 times operating profit, while Cie. Financiere Richemont SA has an enterprise value of 13 times earnings before interest and taxes, data compiled by Bloomberg show. At 5 billion euros, Ferrari would trade at about 17 times Ebit, compared with a European luxury industry average of 12.7 times, the data show.

Ferrari, which employs 2,700 workers, increased deliveries 6 percent last year to 6,573 cars. Lamborghini SpA, its main competitor, built 1,302 vehicles last year and posted revenue of 271 million euros. Lamborghini, which is owned by Volkswagen AG, has said it narrowed its loss in 2010 without providing figures.

“Rarity value and a compelling equity story could push Ferrari’s valuation,” said Massimo Vecchio, an analyst at Mediobanca SpA in Milan who estimates Ferrari could raise as much as 2 billion euros for a 45 percent stake of the unit.

While Marchionne said he sees no urgent need to list the Italian sport-car maker, he reiterated his commitment to a Chrysler share sale to raise money for the United Auto Workers union’s retiree health-care trust, which owns 59.2 percent of the American carmaker.

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Ferrari Seeks to End Trademark Dispute

Italy’s Ferrari said Thursday it has agreed “in good faith” to use the full name of its new Formula One race car after Ford Motor Co. complained that its abbreviation was a copy of the name of its best-selling pick-up truck, the F-150.

Ford, of Dearborn, Mich., filed a lawsuit against Ferrari for referring to the racer as the F150, saying it was an infringement on its trademark, reported The Wall Street Journal.

In a brief statement Thursday, Ferrari said it would refer to the racer by its full name—the Ferrari F150th Italia, which refers to the country’s 150th anniversary being celebrated this year.

Ferrari, which is majority owned by Italy’s Fiat SpA, said it saw no reason why the abbreviated version of the name would have caused confusion.

“Ferrari retains that there can be no way to confuse the one-seater…or even think that there would be a link with another brand,” it said.

“It seems really difficult to understand what has been expressed by Ford,” it added.

Ford spokeswoman Anne Marie Gattari said the U.S. car maker was more concerned about its brand being diluted.

In the lawsuit filed Wednesday, Ford said Ferrari was trying to “capitalize on and profit from the substantial goodwill that Ford has developed in the F-150,” according to a copy of the court filing. The suit sought unspecified damages. A court date has not yet been set.

The Detroit company sought to bar Ferrari from copying or using the F-150 trademark in any way in the U.S. and asked the court to have Ferrari recall all products, labels, tags, signs, prints, packages, videos, advertisements using the F-150 brand.

Ford has been using the F-150 name since 1975 and has had a trademark on it since 1995.

Ferrari unveiled on Jan. 28 the new racer for the 2011 season. The one it had for the team last year was called the F10.

Ferrari drivers Fernando Alonso and Felipe Massa are test-driving the new racer in Spain in preparation for next month’s Grand Prix in Bahrain.

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