By Giulio Piovaccari
MILAN (Reuters) -Italy’s Agnelli family cut its controlling stake in Ferrari by around 4%, raising about 3 billion euros ($3.14 billion) to fund potential new M&A deals, its holding company Exor said on Thursday.
The sale will help Exor reduce concentration in its investment portfolio and provide ammunition for “a sizeable new acquisition when such an opportunity presents itself”, the company said late on Wednesday launching the disposal.
It will also use proceeds from the deal to fund a 1 billion euro buyback programme.
The majority of the proceeds of the placement will be used for a single acquisition to add to Exor’s portfolio, a source close to the company said.
Exor sold the Ferrari shares at a price of 450 euros each – in a so called accelerated bookbuilding procedure, which was conducted by banks JPMorgan and Goldman Sachs – one of the bookrunners said on Thursday.
Exor has not disclosed the price.
Separately on Thursday, Ferrari said it had spent about 300 million euros to buy nearly 667,000 of its own shares in the transaction as part of its own buyback programme.
Ferrari’s Milan-listed shares were down 8.1% by 1245 GMT at 444 euros, after closing on Wednesday at 483 euros, near their record high hit earlier this month.
Dutch-listed Exor shares reversed early gains and fell 1.9%.
Ferrari accounts for about 50% of Exor’s net asset value (NAV).
After the share sale, which will be settled on March 3, Exor will remain Ferrari’s top investor with a 20% stake and 30% of voting rights.
“Our commitment to remain (Ferrari’s) largest shareholder for the long term is stronger than ever,” Exor CEO John Elkann said in a statement.
Agnelli family member Elkann is also Ferrari chairman.
The deal will not alter a shareholder agreement between Exor and Piero Ferrari, the son of founder Enzo and Ferrari’s second largest investor. Exor and Piero Ferrari will retain combined voting rights close to 50%.
Exor is the single largest shareholder in automaker Stellantis and Dutch group Philips. It controls manufacturers Iveco and CNH, as well as Serie A soccer club Juventus.
It also has investments in healthcare, luxury goods, technology and media.
($1 = 0.9549 euros)
(Reporting by Giulio Piovaccari in Milan and Urvi Dugar in BengaluruEditing by Valentina Za, David Goodman and David Evans)
