The Financial Times published this article on 18 March 2002, written by Paul Betts:

Ferrari chief keen for IPO to drive growth

Luca di Montezemolo, Ferrari's chairman, is keen to see the sports car and racing company launch a public offering on the stock market. He told the Financial Times this would help fund Ferrari's expansion into entertainment, including the development of Ferrari theme parks. It also wants to step up its retailing activities and further develop its Maserati car business.

To launch an initial public offer, Mr Montezemolo needs the approval of Ferrari's main shareholder, the Italian Fiat automotive group with 90 per cent of the company. The other 10 per cent is held by Piero Lardi-Ferrari, son of the company's founder.

In a leaked document following a recent board meeting, Fiat said it was contemplating a possible Ferrari IPO within the framework of a programme to cut its Euros 6bn debt. However, a person close to Fiat suggested yesterday that a Ferrari IPO was unlikely before next year. One key issue would be how the proceeds would be split between Fiat and Ferrari.

"At the moment there is no decision," confirmed Mr Montezemolo. "But if I could make a suggestion to my main shareholder, I would say they should think about an IPO."

Ferrari had always relied on its own financial resources and would continue to do so. But at some later stage, an IPO would help raise fresh resources for new developments, he explained. Mr Montezemolo was speaking ahead of Ferrari's announcement later this week of record profits and sales for 2001, shrugging off the economic slowdown and September 11 terror attacks.Sales topped Euros 1bn for the first time.

A move into entertainment would give Ferrari a third core business to complement its commercial sports car and Formula 1 racing activities. Mr Montezemolo has been encouraged by approaches from hotel developers to build a Ferrari hotel in Las Vegas.

An IPO would also help develop Maserati. Ferrari relaunched Maserati four years ago and Mr Montezemolo said he now wanted to develop its racing activities. He said Ferrari's board would meet on Friday to sign off record profits and sales last year. Group sales rose 17 per cent to Euros 1.042bn. Operating profits rose 36 per cent to Euros 62m after absorbing a Euros 30m loss at Maserati and a sharp rise in investments from Euros 52m in 2000 to Euros 124m last year.

The company sold more than 6,000 cars including 4,256 Ferraris and 1,767 Maseratis. In the US, Ferrari sold a record 1,220 cars last year despite the economic downturn and September 11. There was a two and a half year waiting list for Ferraris in the US. But Mr Montezemolo insisted that the company would maintain its cap of selling a maximum of 4,200-4,300 Ferraris each year to retain its exclusivity.

The target for Maserati was to sell 6,000 cars a year by 2004 thanks to new models. Sales were expected to reach 3,500 cars this year with the brand breaking even at the end of next year. "Maserati is now back in the US after a 15-year absence," said Mr Montezemolo. "Remember we rebuilt the brand from scratch closing down the factory for six months."

On the retail side, the company is opening this week outside its Maranello headquarters in central Italy its first speciality store selling a wide range of products with the Ferrari brand. Mr Montezemolo, who recently joined the board of the French retail and luxury goods group Pinault-Printemps-Redoute, plans to open a series of flagship stores in New York, London, Paris, Tokyo, Hong Kong and one German city.

Click here to return to the Ferrari Happenings page.