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Fiat, the struggling Italian industrial group, hopes Ferrari will be valued at about €2.5bn ($2.3bn) - twice estimated sales - when the sportscar maker launches an initial public offering this autumn, people familiar with the listing said. Fiat last week decided to sell about 40 per cent of Ferrari to raise cash needed to lower debt and help offset massive losses at Fiat Auto, the car division that produces the more mainstream Fiat, Alfa Romeo and Lancia models. Fiat owns 90 per cent of Ferrari, while Piero Lardi Ferrari, the son of founder Enzo Ferrari, owns the remainder. Fiat selected Deutsche Bank, IntesaBCI and UniCredito Italiano to manage the offering, whose announcement triggered a flurry of solicitations from bankers worldwide seeking to manage the high-profile listing. An IPO could take place in October if the US economy remained steady, one person said. Fiat could raise €700m-€800m from the offering, while Ferrari could raise about €300m more through the sale of new shares. The sportscar maker would use the cash to market Maserati, a brand it has revived from bankruptcy since acquiring it in the mid-1990s. Ferrari also wants to enter joint ventures for hotel and entertainment centres built around the brand and its Formula One racing success. Ferrari last year had sales of €1.04bn and a net profit of €47m, but it expects to greatly increase both this year thanks to the introduction in the US of its Maserati marque. Maserati, which stopped selling cars in the US in the early-1990s, aims to sell 1,200 vehicles this year priced at $85,500-$95,500. Worldwide, Maserati expects to double sales to 3,500 units largely thanks to the roll-out of its Spyder two-seat convertible. Many analysts have valued Ferrari between €1.3bn and €2bn, although they admit it is too early to make a detailed estimate. Bankers are hoping Ferrari will be worth double estimated revenues for this year, a multiple far higher than that of Porsche, the nearest comparison, analysts said. "They want multiples of a luxury goods group like Hermes. That may be a bit tough even if there are a lot of racing fans probably willing to buy at any price. Porsche has seven years of profits behind it, Ferrari's just getting there," said one analyst. Click here to return to the Ferrari Happenings page.
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