Ferrari is to be spun off into a separate company by its parent, Fiat Chrysler, in a bid to unlock value in the luxury brand and distinguish it from its mass-market parent.
Fiat Chrysler said that spinning off Ferrari was part of a plan to raise capital to support the new merged carmakers’ expansion plans. The company’s five-year plan aims to increase net income by five times by 2018.
CEO Sergio Marchionne stated in a press release that it was “proper that we pursue separate paths for [Fiat Chrysler Automobiles] and Ferrari” following the completion of the merger between Chrysler and Fiat, which was listed on the New York Stock Exchange earlier this month.
Fiat Chrysler will sell 10% of Ferrari’s shares in a public offering, with the remaining 90% distributed to its shareholders. The board intends to complete the move during 2015 and said the shares would be listed in the US, with a possible double listing in Europe. Industry experts had long speculated on a Ferrari spin-off as Marchionne seeks to maximise value from the group’s various brands. However, Fiat Chrysler’s other luxury brands, including Alfa Romeo and Maserati, will remain part of the parent company.
The decision to break off Ferrari comes less than two months after an awkward management transition at Ferrari, which saw the longtime chairman, Luca di Montezemolo, resign following a public spat over strategy with Marchionne, who has since taken over as chairman of Ferrari. Marchionne has been vocal in his displeasure over Ferrari’s long absence from the Formula One car racing winner’s circle, and has pledged to get the team back to the top. The last time it won the driver’s championship was in
