Fiat Chrysler Automobiles CEO Sergio Marchionne (file photo)
Fiat Chrysler Automobiles plans to spin off Ferrari as it seeks to raise $4.7 billion to counter rising debt, according to Bloomberg.
The company – formed from the merger of Fiat and Chrysler – will list 10 percent of Ferrari in the U.S.and possibly Europe and intends to complete the deal next year.
The remaining shares will be distributed to FCA investors. Piero Ferrari, son of company founder Enzo Ferrari, will retain his current 10 percent stake in the exotic, high-performance automaker.
The sale is expected to raise about $1.15 billion, Bloomberg said.
“As we move forward to secure the 2014-18 business plan and work toward maximizing the value of our businesses to shareholders, it is proper that we pursue separate paths for FCA and Ferrari,” CEO Sergio Marchionne said in a statement.
FCA’s board met Wednesday at its new headquarters in London to discuss the group’s expansion plans through 2018.
The company’s goal is to increase net income five-fold to more than $5 billion.
It plans to sell $2.5 billion in bonds as well as 100 million shares of stock — expected to raise another $1.1 billion — to help finance the expansion plans.