RACE to IPO: Ferrari sets terms for $859 million US IPO

“Ferrari’s coveted status as a maker of cars for the super rich is helping push up its value in an initial public offering to as much as 11 billion euros ($12.4 billion), according to people familiar with the matter”, reported Bloomberg’s Tommaso Ebhardt, Manuel Baigorri and Ruth David.

Ferrari is set to be listed on the New York Stock Exchange under the ticker FRRI.

FCA chief executive Sergio Marchionne earlier this year claimed the Prancing Horse brand should be worth at least 10 billion euros (~$11.3 billion USD). Those companies trade at over 20 times operating profit, more than twice the average valuation of carmakers.

Fiat Chrysler (FCAU), which owns Ferrari, is expected to divest a 10% stake of Ferrari via an IPO at a few point this month, reports say.

The company’s adjusted EBITDA stood at 693 million euros, compared to 634 million in 2013 and 573 million in 2012. Profit rose 8.9% in 1-H of Y 2015. Representatives for Fiat Chrysler and Ferrari declined to comment. Back in 2013, the ultra-luxury automaker limited the number of cars it would produce each year to 7,000, in a move to maintain the exclusivity of the one of the auto market’s most luxurious brands. Ferrari will stick to producing high-end sports cars, and won’t follow rivals into models such as sport utility vehicles or electric autos, as powerful vehicles with traditional growling engines are part of what customers pay for, CEO Amedeo Felisa said in September.

UBS AG, Bank of America Corp.’s Merrill Lynch, Banco Santander SA, Mediobanca SpA and JPMorgan Chase & Co. are advising on the IPO.