- Investors vote about 98 percent in favor of separation
- Fiat investors will get 80 percent of Ferrari early next year
Fiat Chrysler Automobiles NV investors approved the spinoff of its supercar unit Ferrari NV, part of Chief Executive Officer Sergio Marchionne’s plan to raise cash and reduce debt.
Shareholders voted about 98 percent in favor of the separation, in which Fiat Chrysler will distribute the remaining 80 percent stake in Ferrari to its own investors starting early next year. About two-thirds of Fiat Chrysler’s voting rights were present. The Italian-American carmaker already sold 10 percent of Ferrari in a New York initial public offering in October, raising about $1 billion. Piero Ferrari, son of the founder Enzo, holds the remaining 10 percent.
Strained by 10.3 billion euros ($10.9 billion) in net debt, Fiat Chrysler will raise about 3.8 billion euros from the separation of Ferrari. That will reduce its debt by about 1.6 billion euros with the deal, according to a presentation posted on its website. At the same time, though, it loses its most lucrative division.
"The separation will better enable Ferrari to realize its full potential," Marchionne said at the shareholders’ meeting, held in Amsterdam Thursday, where London-based Fiat Chrysler is registered. "It will also allow Fiat investors to benefit directly from the substantial value inherent in Ferrari."
Exor SpA, the Agnelli family holding company, will control the supercar maker with Piero Ferrari, and the two shareholders will sign a shareholder pact, Ferrari said in October. Through a loyalty voting scheme, Ferrari’s heir and Exor will control almost 50 percent of the voting rights.
Ferrari shares closed yesterday at $47.21 in New York, 9.2 percent below its IPO price.