German auto giant Volkswagen on Tuesday said it was drawing up plans to list its luxury brand Porsche as it looks to raise the funds for its move to electric vehicles.
Volkswagen and its largest shareholder Porsche SE had “negotiated a framework agreement which should form the basis for further steps” towards a separate stock market listing, the carmaker said in a statement.
A “final decision” had not yet been taken, said the group.
The potential multi-billion-euro deal, long-mooted by analysts, would help Volkswagen finance its shift away from traditional combustion engines towards the production of electric vehicles.
Volkswagen group’s parent company and main shareholder is Porsche SE, which shares its name with the maker of the famous 911 sports car and which is also listed on the Frankfurt Stock Exchange.
According to previous reports in the German press in 2021, the holding company Porsche SE was considering selling part of its stake in the Volkswagen group to purchase a larger share in the new spin-off.
The Volkswagen group — whose 12 brands include Audi, Porsche and Skoda — is pumping 35 billion euros into the shift to electric vehicles and aims to become the world’s largest electric carmaker by 2025.
Shares in both the carmaker and the holding company jumped on the news. At 10:37 am local time (0937 GMT) Volkswagen was up 8.90 percent to 190.56 euros, while Porsche SE rose 10.79 percent to 90.36 euros.
In an effort to simplify the group’s structure, Volkswagen introduced its bus and lorry subsidiary Traton onto the stock exchange in 2019.