Porsche SE weighs Volkswagen stock sale to help fund Porsche IPO sources

A new logo of German carmaker Volkswagen is unveiled at VW’s headquarters in Wolfsburg, Germany, September 9, 2019. REUTERS/Fabian Bimmer

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FRANKFURT, March 1 (Reuters) – Porsche SE (PSHG_p.DE) is considering reducing its stake in Volkswagen (VOWG_p.DE) to just over 50% of ordinary shares to generate cash to participate in a potential stock market listing of Porsche AG, two people familiar with the matter said.

This way, Porsche SE, which is controlled by the Porsche family and Piech, could raise around 2.2 billion euros ($2.5 billion) at current market prices without losing the majority of Volkswagen’s voting rights. .

Such a move, which the sources say is a financing option being discussed in addition to going into debt, would help Porsche SE, Volkswagen’s largest shareholder, pay for the stake in Porsche AG it is expected to get in the framework of enrollment plans.

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Under a framework agreement unveiled last week, Porsche SE will be able to buy 25% plus an ordinary share in a listing of Porsche AG, which would cost around 12 billion euros assuming a valuation of 90 billion. Read more

A spokesperson for Porsche SE said settling on a specific financing plan makes no sense at this stage since several parameters of the potential transaction, which still have no firm decision from the companies, are not clear.

“In principle, however, Porsche SE has great financing potential due to its excellent equity ratio and positive net liquidity. We have prepared rock-solid financing plans in order to be well positioned for the future. IPO under different price scenarios.”

Volkswagen declined to comment.

Porsche SE currently owns 53.3% of the ordinary shares of Volkswagen (VOWG.DE), representing a 31.4% stake.

While Porsche SE is expected to get €3.6 billion via a special dividend that Volkswagen expects to pay from any planned listing of Porsche AG, it would still leave around €8 billion for the holding group to pay the rest.

($1 = 0.8952 euros)

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Reporting by Jan Schwartz and Christoph Steitz Editing by Hans Seidenstuecker, Madeline Chambers

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