volkswagen-shares-up-2.7-in-early-trade-on-truck-listing-plans

Volkswagen shares up 2.7% in early trade on truck listing plans

© Reuters. Visitors stand at booth of VW's truck unit Traton Group in Hanover© Reuters. Visitors stand at booth of VW's truck unit Traton Group in Hanover

FRANKFURT (Reuters) - Volkswagen (DE:) shares were up 2.7% in early trade on Tuesday after the multi-brand carmaking group said it would press ahead with a listing of its trucks unit Traton in what could be Germany's biggest share offering this year.

Volkswagen said in a statement late on Monday that its supervisory board and board of management agreed to prepare an IPO for Traton before the 2019 summer break, "subject to further market developments".

The company in March delayed an initial public offering for the trucks unit, blaming market conditions, amid rising trade tensions and fears about an uncontrolled exit of Britain from the European Union.

In a surprise move on Monday, VW said it would resume preparations for an IPO in summer this year. VW had previously said it could list up to 25% to raise up to 6 billion euros ($6.7 billion).

Jefferies analyst Philippe Houchois said Traton was worth 15 billion to 16 billion euros. "A listing should be positive as the current VW balance sheet is in our view a constraint on Traton's ability to execute on its 'Global Champion Strategy'."

"Current market assessments have encouraged us to take today's decision," Volkswagen finance chief Frank Witter said in a statement.

Traton includes the MAN, Scania and Volkswagen trucks businesses. Volkswagen wanted to list it as part of its drive to create a global trucks business.

Volkswagen also said it was looking into options for its MAN Energy Solutions business, which makes large diesel engines for ships and power generators, as well as transmissions maker Renk, including joint ventures, partnerships, a full or partial sale.

Reuters reported earlier this month that Volkswagen had approached several companies to gauge their interest in buying MAN Energy Solutions, which is expected to achieve a valuation of about 3 billion euros in a potential sale.

The moves are part of Volkswagen Chief Executive Herbert Diess's efforts to slim down and simplify the group which has 12 brands, trucks, buses, motorbikes, cars and electric bicycles as part of its business.

Disclaimer: Fusion Media

would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.