AUTO INDUSTRY NEWS

Ferrari to be sold by parent company

Ferrari to be sold by parent company  image

Text: Eric Tipan / Photos: Ferrari Facebook | posted October 30, 2014 09:26

Fiat to sell 10 % of Ferrari via public offering

Fiat-Chrysler Automobiles revealed its plans to spin off a portion of its stake in Italian automaker Ferrari to raise cash for its very optimistic business plan. The $61-billion master plan is to inject funds for a massive five-year project to turn Maserati, Jeep and Alfa Romeo into household names around the world.

The price to pay though may be too steep depending on which side of the fence you’re standing on.

Fiat-Chrysler Automobiles (FCA) - the parent company of Ferrari, Maserati, Alfa Romeo and Jeep - has, as part of the grand scheme, announced that they will offer 10 percent of the Prancing Horse to interested parties through a public offering in the U.S. and Europe.

The other 80 percent will be distributed to shareholders of FCA including the 30 percent that will go to Fiat’s founding Agnelli family while the remaining 10 percent is still owned by Piero Ferrari, the only living son of the founder Enzo Ferrari.

FCA, which has owned Ferrari for 45 years, is pulling off a move that has been resisted by CEO Sergio Marchionne for the longest time.  The Ferrari sale is expected to raise $5.1 billion.

"This transaction represents FCA's best course of action to support the long-term success of the Group while at the same time substantially strengthening FCA's capital base," said Marchionne in a statement.

The announcement of Ferrari’s sale raised FCA’s stock by 18 percent.