Milan (AFP) – Legendary carmaker Ferrari completed its spinoff from Fiat Chrysler Automobiles with a debut on the Milan stock exchange Monday and pledged to remain faithful to its luxury heritage.
Eight gleaming sportscars lined up in front of Milan’s “Midnight Palace” — including the latest F12 Tdf model — and the throaty roar of Ferrari engines could be heard throughout the listing ceremony.
Prime Minister Matteo Renzi was among the elite walking the red carpet between the sleek red, blue and yellow cars, while Ferrari Chairman Sergio Marchionne rang a bronze bell to mark the brand’s bow.
Trading under the RACE ticker saw shares open at 43 euros before slipping to 41.75 euros, being briefly suspended and finally closing at 43.67 euros — easily outperforming the overall Milan market which fell 3.2 percent on the day.
The share sale came two and a half months after the legendary mark of the prancing horse roared onto Wall Street.
“But the truth is that today another big chapter is beginning. This listing marks Ferrari’s independence, which is essential in maintaining its development and potential,” he said, promising customers “ever-more exclusive models”.
Ferrari, known for its high-price sports cars, is the biggest and most glamourous name in Formula One racing and the team’s logo of a black stallion against a red background is instantly recognised by motorsport fans around the world.
The IPO will not have any impact on Ferrari’s involvement in Formula One racing, in which it is reemerging as a force after enduring a lean period in the slipstream of world champion Lewis Hamilton’s Mercedes team.
– Tampering with Ferrari jewel ‘dangerous’ –
Marchionne brushed off rumours of expanding the brand, saying it would be “extremely difficult” because “Ferrari is so unique that trying to tamper with it is very dangerous”.
As a unit of Fiat Chrysler, the supercar maker was a cash generator: in 2014 it reported net revenues of 2.76 billion euros ($3.13 billion), and a net profit of 265 million euros.
At the end of June, the carmaker had net debt of $10.8 billion due to a combination of the costs of its Chrysler takeover and ongoing loss making activities in Europe.
The company plans to invest some $48 billion to expand its total worldwide sales to seven million vehicles per year, largely through the development of its Jeep, Alfa Romeo and Maserati brands.
But losing the Ferrari jewel will increase scrutiny of Fiat Chrysler chief executive Marchionne’s plans, amid growing doubts over whether his targets can be met despite slowing markets in China and Brazil.
Marchionne has been pushing the idea of another merger with a major brand — General Motors is his named target — in the belief that only more consolidation in the global auto industry will guarantee a company’s survival.
“The need for consolidation has been portrayed as a sign of weakness on our part, but that’s rubbish,” he said, adding that the company has been approached with offers but none have yet been considered viable.