In February 2022, Volkswagen confirmed there were discussions with Porsche to potentially bring the sports car company public. These discussions have not yet developed any definitive information on specific future dates for the IPO release; however, it has been speculated that the IPO could occur as early as Q4, 2022. This estimate could easily change as discussions between the two parties develop and as market conditions evolve over the coming year. Especially regarding the fears in the market concerning inflation, increasing commodity prices and supply chain issues. Any of these factors could take a turn for the worst and change the direction of the IPO date or even the IPO occurrence itself.
What do we know so far about the Porsche IPO?
As discussions progress, there is much that we do know now. Volkswagen has released intentions of its plans to divide the stock of Porsche AG, 50% being ordinary common shares and 50% as preference shares. Then there will be up to 25% of the preference shares listed, meaning, that only 12.5% of the IPO will be floated. With these shares, the ordinary common shares will maintain their voting rights, whereas the preference shares will not.
When it comes to any potential valuation, it is very much still pure speculation this early in the IPO discussions. As it currently stands, there are reports that Porsche AG could receive a valuation of up to $90 billion and, as of now, Volkswagens the latest market capitalization sits at $90.8 billion as a comparison. For other related, current market capitalization of competitors, Mercedes-Benz and BMW stand at $75.75 billion & 53.71 billion, respectively.
Wherever the valuation lands, Volkswagen has stated it plans to pay out 49% of the total proceeds from the sale to shareholders as a “special dividend”. The remaining amount will be reinvested back into the business. Existing shareholders will be on the lookout for conformation on valuation, as this will confirm the size of their incoming special dividend if the IPO transpires. With consideration of everything, there are still months until Q4, and market conditions remain quite volatile, leaving much in the air.
Porsche and Volkswagen will be under remarkably close observations over the next few months as information develops, but there are other anticipated IPOs that investors should be on the lookout for in 2022. Instacart, Chime, Mobileye, VinFast and Stripe are just a few of the top discussed IPOs this year. Stripe is one that many are watching particularly closely due to the big-name partnerships they have with Apple Inc. and Shopify Inc. Stripe is a company that provides SaaS solutions for e-commerce websites and applications and is expanding into the cryptocurrency space to provide solutions that bring efficiency with transactions. As of now, ahead of the IPO, Stripe is sitting at a potential valuation of $95 billion.
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