Volkswagen Sets Sights on Raising €2 Billion with Traton Share Sale
In a bid to bolster its finances, German automaker Volkswagen is planning to offload 15% of its shares in truck unit Traton in the first half of this year, according to sources close to the matter. This strategic move is expected to generate approximately €2 billion, a significant influx of capital for the company.
Traton’s Limited Free Float: A Barrier to Investment
Currently, Volkswagen holds a substantial 89.72% stake in Traton, with the remaining 10.28% available for public trading. This limited free float has been a point of contention among investors, who have expressed concerns about the lack of liquidity in the market. Traton’s spokesperson acknowledged that the company regularly receives feedback from investors highlighting this issue, which has been echoed by Volkswagen’s CFO, Arno Antlitz, during an earnings call in April.
A Shift in Ownership Structure
In 2019, Traton underwent a partial initial public offering, which saw Volkswagen retain a significant majority stake in the company. However, in May, Volkswagen’s CEO, Blume, announced plans to reduce the company’s stake in Traton to 75% plus one share over the medium term. This move is seen as a strategic effort to increase the free float and attract more investors to the company.
A New Chapter for Traton
As Volkswagen prepares to sell off a significant portion of its shares in Traton, the truck unit is poised to enter a new phase of growth and development. With a larger free float, Traton is likely to attract more investors, increasing its visibility and credibility in the market. This move is expected to have a positive impact on the company’s financial performance, paving the way for future success.
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