Porsche gears up for IPO thrills but dealmakers are stuck in the slow lane

theguardian.com:

What gets the pulses of the super-rich racing? Fast cars and stock market floats probably feature high on the list. The initial public offering (IPO) of Porsche is well set to deliver thrills on both counts when shares start trading on Frankfurt’s stock exchange on Thursday.

With a hoped-for valuation of €75bn (£65bn), the spin-out of the German sports carmaker from its owner Volkswagen would count as the fifth-largest float in European history.

But there is no getting around the fact that it is a strange time to be punting a giant IPO. After two years of central bank stimulus to prop up the pandemic economy, inflation driven by the war in Ukraine has brought the prospect of recessions in major markets. Carmakers are still facing tough supply chain challenges.

Dealmaking has slumped. Global IPOs have been worth £97bn so far in 2022, compared with £320bn last year, according to the data company Dealogic. In Europe the difference is even starker, with floats worth a paltry £4.8bn this year, compared with £48bn in 2021.

Volkswagen and Porsche have been intertwined since the very start: Ferdinand Porsche founded a car company in the 1930s, before designing the original “people’s car”. Why would it choose this moment to undo that pairing?

One reason is fairly straightforward: Volkswagen needs the cash. It could receive as much as €19.5bn in the deal (although it will pay out nearly half as a special dividend). The world’s second-largest carmaker by volume has gone all-in on producing electric-only models, stung by the fines and reputational catastrophe of the diesel emissions-cheating scandal. That electrification push means it needs money to retool factories.

Another reason is that other brand with a black prancing horse on its