Fiat Chrysler hands over 80% stake in supercar brand - but Agnelli/Ferrari deal will prevent hostile takeovers

Ferrari shares are now trading on the Italian stock exchange, after the Fiat Chrysler group distributed its 80% stake in the supercar manufacturer over the weekend.

The move, designed to complete a flotation that was first announced more than a year ago, means that Fiat is no longer officially in direct control of the car manufacturer that it purchased back in 1969. The powerful Agnelli family that founded Fiat is still Ferrari’s largest shareholder, though, with 24% of stock. Piero Ferrari, the son of the sports car brand’s founder Enzo, holds 10%.

However, because longer-term Ferrari investors get extra influence in corporate issues, in effect the Agnellis and Piero Ferrari control just under 49% of voting rights. In December the two parties signed an agreement designed to prevent any hostile takeovers by agreeing to offer each other first refusal on any stock they want to sell.

Ferrari shares dropped by around 5% during initial trading on the Italian stock exchange in Milan. They have failed to stay at the price set during their Initial Public Offering (IPO) in New York, too, falling around four dollars since they were issued at $52 in October.

Around 10% of Ferrari was offered in that initial sale. The company's chairman Sergio Marchionne started the day’s trading on Wall Street by ringing the bell at the NYSE, and confirmed that the company would use RACE as its ticker symbol for its listing on the exchange.

Sergio Marchionne, boss of FCA and more recently Ferrari, said recently: "Following our acquisition of the minority interest in Chrysler earlier this year, the transformation of Fiat and Chrysler into FCA was completed earlier this month with our debut on the New York Stock Exchange.

"As we move forward to secure the 2014-2018 Business Plan and work toward maximising the value of our businesses to our shareholders, it is proper that we pursue separate paths for FCA and Ferrari."

Ferrari boss Sergio Marchionne on why change is needed at Maranello

Insight - Luca di Montezemolo's final Ferrari press conference

Last year Luca Cordero di Montezemolo, chairman of Ferrari since 1991, resigned from his position and was replaced by Marchionne. At the time, he said: "Ferrari will have an important role to play within the FCA Group in the upcoming flotation on Wall Street.

"This will open up a new and different phase which I feel should be spearheaded by the CEO of the Group."

There were rumours, however, that Montezemolo and Marchionne had clashed over the future of Ferrari.

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Comments
13

29 October 2014

over the ownership of Ferrari, to all intense and purposes it could end up a Russian company or like Land Rover Indian, surely not under VW like Lambo. Not sure where this lives Fiat or the F1 team but Alonso timed his exit well. This is far from the end of the story.

 

Hydrogen cars just went POP

29 October 2014

Must be good,shows some recovery and confidence in there home market.

Peter Cavellini.

29 October 2014

xxxx, you're failing to recognise that they might list just a small subset of shares, not enough for any other party to gain control.

29 October 2014
RogerGraham wrote:

xxxx, you're failing to recognise that they might list just a small subset of shares, not enough for any other party to gain control.

The way I read it.....

FCA own 90% and it states "A total of 10 per cent of FCA's interest in Ferrari will be offered to public investors. The remainder will be distributed among FCA shareholders"

In which case it's given up 90% of Ferrai's shares. Therefore going forward anyone company can start buying up shares until they get to 51%, just like pension companies were buying up post office shares from indivduals.
I may have read it wrong but at the end of the day 90% of Ferrari shares will be floating around.

 

Hydrogen cars just went POP

29 October 2014

its too early to say. there arent enough details in the article. No details in the FT either which means they havent figured out how to do it yet.

29 October 2014

Lots of questions..

Will Maserati continue to be owned and run by Ferrari ? What about the cooperation on the various Alfa Romeo projects ?

Will Sergio Marchionne remain chairman of Ferrari, whilst continuing to run FCA ? Even after the spin-off ? Why did he get rid of di Montezemolo, if he was going to spin Ferrari off anyway ? Surely, di M. would have provided continuity for the new stand alone company at a time when it most requires it.

How much FCA debt will be transferred onto to Ferrari's balance sheet prior to spin off ?

29 October 2014

Sergio Marchionne is a clueless, dumb oaf. Alfa Romeo R.I.P. And now Ferrari...God knows what the Arabs and Americans will do with it.

29 October 2014

So 10% of Ferrari is still owned by Ferrari Blood.

10% will be issued for public sale which is bound to raise a an over-inflated amount of funds for that small 10% (every rich Ferrari Fan will want a piece).

Then the remaining 80% will be distributed between a selective number of shareholders within in FIAT. So if the 80% want to sell to public or sell back to ferrari or even VW that's where the infighting begins. I'd assume son of Ferrari would probably have first refusal on the shares. This could be disastrous for Ferrari or very lucrative for BMW Ferrari?!

Maserati is now a FIAT ambition and Alfa isn't really worth mentioning as last time Alfa were really related... Enzo Ferrari was a youthful man.

29 October 2014

1 Rumour mill starts to flush out industry interest
2 CEO of Fiat and chairman of Ferrari have a set to. Fiat call the shots so chairman has to leave. Will not damage Ferrari, so bites his tongue
3 10% public float plus 90% distributed to Fiat's shareholders means all but 10% held by Piero Ferrari would be 'in play'
4 Before this happens for real, corporate turnaround specialists and VC investors start sniffing around to see if Ferrari can make money long term
5 the IPO process will require Ferrari's results to be 'carved out' from Fiat's - we get an idea of how much money Ferrari makes or loses
6 As a stand alone or VC backed enterprise Ferrari does not have economies of scale - it needs a serious sugar daddy to replace Fiat
7 the IPO process flushes out all these interested parties sooner or later, as well as the trophy hunters who soon find their pockets are not deep enough
8 So, next stop is...VW? Mercedes (too busy targeting Aston), BMW?, Geely? Tata?
9 next generation Ferrari California is on a VW Golf platform....

29 October 2014

10% of 90% is 9%. So that's what's going public. The other shares are being distributed amongst those who already own them. It's more of a conscious uncoupling of Ferrari from Fiat than a sell off!

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