Ferrari Raises $893 Million Pricing IPO Shares Top of Range

Ferrari IPO: How NYSE Secured the Listing
  • Supercar maker offered 17.18 million shares for $48-$52 each
  • Ferrari will have EV of about $12 billion including Fiat Debt

Ferrari NV raised $893 million in its U.S. initial public offering, pricing the shares at the top end of the marketed range after investor demand in the supercar maker outstripped the stock available.

Majority shareholder Fiat Chrysler Automobiles NV, which is selling a 9 percent stake in the iconic Italian brand, priced 17.18 million shares at $52 each, according to a statement Tuesday, after offering them for $48 to $52 apiece. Including debt Ferrari will take on from Fiat, the company will have an enterprise value of about $12 billion.

The shares will start trading Wednesday, listed on the New York Stock Exchange under the symbol RACE.

Chairman Sergio Marchionne, who is also Fiat Chrysler’s chief executive officer, will ring the opening bell at the NYSE with other executives, including Vice Chairman Piero Ferrari, the son of founder Enzo Ferrari, and Fiat Chrysler Chairman John Elkann, whose family will become Ferrari’s biggest shareholder after the spinoff from its Italian-U.S. parent company next year.

Fiat Chrysler will raise more than $4 billion from taking Ferrari public, including an extra 1.7 million shares in an overallotment to underwriters, plus 2.8 billion euros ($3.2 billion) in additional cash that the division will provide before next year’s spinoff.

Fiat Chrysler fell 3.3 percent to 13.75 euros at 9:15 a.m. in Milan. The shares traded in New York have risen more than 60 percent since Oct. 28, 2014, the day before Marchionne announced the plans for Ferrari. That is the best performance among major auto-industry stocks -- compared with a gain of about 7 percent for General Motors Co. and a plunge of almost 40 percent for the preferred shares of Volkswagen AG, the German company that has been grappling with a diesel-emissions test-cheating scandal in the past month.

Investors’ demand for Ferrari shares greatly exceeded the number available, people familiar with the matter said last week. Fiat Chrysler is limiting the stock on sale to ensure that it’s sought after, in the way that Ferrari boosts its products’ allure by capping the number of cars it makes. Fiat Chrysler plans to distribute its remaining 80 percent stake in Ferrari to its own investors early next year. Piero Ferrari will retain his 10 percent holding.

UBS Group AG and Bank of America Corp.’s Merrill Lynch managed Ferrari’s IPO. Allen & Co., Banco Santander SA, BNP Paribas SA, JPMorgan Chase & Co. and Milan-based Mediobanca SpA also worked on the offering.

Cash from the disposal is critical to enable Fiat to finance a 48 billion-euro investment program focused on expanding the Jeep, Alfa Romeo and Maserati nameplates as Marchionne seeks to boost annual deliveries by more than 50 percent to 7 million vehicles by 2018.

Interest in Ferrari contrasts with lackluster demand for other IPOs. Three U.S. deals faltered within about a week this month, as Digicel Group Ltd. canceled a sale, First Data Corp. priced shares below a marketed range and Albertsons Cos. postponed its offering.

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