Volkswagen’s trucks and buses hit the stock market. Traton, the truck branch of the manufacturer, which includes the brands MAN and Scania, makes its introduction this Friday in Frankfurt and Stockholm. But it does not arrive on the hats of wheels: at 27 euros the action, the price is in the low range Volkswagen plans, which aims at a valuation of 13.5 billion euros. This will still make it one of the biggest IPOs of the year in Europe and place in the top 10 German. In the first exchanges in Frankfurt, the share price remained stable.
Volkswagen will open 11.5% of the capital and hopes to draw 1.56 billion euros from the operation. A few months ago, he planned to put 25% on the stock market and get up to 6 billion of fresh money.
Flexibility for Volkswagen
This IPO was originally scheduled for April but, a few weeks before the D-Day, VW had decided to push it back, invoking an unfavorable market environment. However, conditions have hardly changed since, with volatility roughly the same as that measured in March by the VIX index – even if the climate of IPOs seems more dynamic than at the beginning of the year. “We have gained investor confidence and we will work hard to strengthen it,” said Traton CFO Christian Schulz.
For Volkswagen, this IPO marks an important step. The giant Wolfsburg with multiple brands (Audi, Seat, Porsche, Skoda …) seeks to simplify its organization. By consolidating his heavyweight activities into Traton, he is setting aside an activity that is not part of his core business in order to give himself more financial leeway, at a time when he is negotiating an expensive shift towards electric and autonomous cars .
International Expansion
With 233,000 vehicles sold in 2018, Traton has a turnover of nearly 26 billion euros and employs some 81,000 people (out of a total of 640,000 employees in Volkswagen). In addition to German MAN and Swedish Scania, the entity owns a Brazilian commercial vehicle subsidiary and owns 16.8% of the capital of US truck manufacturer Navistar.
The IPO is expected to finance its international expansion, particularly in the United States and China. And so to come tickle the leaders of the sector, Daimler and Volvo.