Ferrari files papers to sell shares to public

Investors and car enthusiasts who want to own a share of Ferrari stock got their first look on Thursday at the future of the brand.

Ferrari outlined plans for its future growth in a document it filed with the U.S. Securities and Exchange Commission.

The company said it plans to pursue "controlled growth in developed and emerging markets" by adding dealerships and expanding its licensing agreements even as it carefully protects the exclusive nature of the exotic sports cars it makes. The company also said it plans to expand the brand into sportswear, watches, accessories, consumer electronics and theme parks.

"While we will continue to pursue a low-volume production strategy and maintain our reputation for exclusivity, we intend to respond to growing demand, both in emerging markets as well as in response to demographic changes and the growth in the size and spending capacity of our target clients," the company said in its prospectus.

Sergio Marchionne, CEO of Fiat Chrysler Automobiles and chairman of Ferrari, has said Ferrari could sell as many as 10,000 cars per year without damaging its exclusivity. Those plans have been criticized by some Ferrari enthusiasts who believe increasing production could diminish the brand's exclusivity.

Ferrari sold just over 7,200 cars in 2014. In its prospectus, the automaker said exclusivity is at the core of its strategic plan.

By filing the prospectus, Fiat Chrysler Automobiles has started a process that will lead to a public offering of stock later this year. Ferrari did not disclose the exact amount of shares it plans to sell or provide an estimate of the initial price per share.

Marchionne wants to unlock the value of Ferrari and turn it into a full-fledged luxury brand. He will use the proceeds of the public stock offering to help fund FCA's $55-billion, five-year expansion plan.

The automaker plans to sell 10% of Ferrari's shares to the public and distribute 80% of the stock to existing Fiat Chrysler shareholders. The remaining 10% will continue to be owned by Piero Lardi Ferrari, a son of the founder.

Because of regulatory issues, Ferrari's public offering cannot occur until after  Oct. 13, a year after Fiat Chrysler listed its shares on the New York Stock Exchange. Ferrari also plans to list its shares on the New York Stock Exchange. The company expects its separation from Fiat Chrysler Automobiles to be  completed early next year.

UBS Investment Bank, Bank of America Merrill Lynch and Banco Santander are acting as joint bookrunners for the offering, and UBS Investment Bank is acting as global coordinator.

After the spinoff, Fiat Chrysler Automobiles will no longer have an ownership stake in Ferrari. However, Exor, an investment firm controlled by Fiat scion John Elkann, will.  Elkann, the great-great-grandson of Fiat founder Giovanni Agnelli, is the chairman of both Fiat Chrysler and  Exor. After the public offering and the spinoff, Exor will own about 24% of Ferrari, according to the filing. Marchionne also will serve as chairman of Ferrari.

Ferrari, founded in 1947 by Enzo Ferrari, is a car manufacturer unlike any other.  The company is embraced in Italy and around the world for its success in Formula 1 racing and is a powerful luxury brand.

The company also operates the world's largest indoor theme park called "Ferrari World Abu Dhabi" in Abu Dhabi, along with retail shops and a museum in Maranello, Italy. It also produces V8 and V6 engines for Maserati.

And even though it only sells a small number of cars annually, Ferrari generated more than $3 billion in revenue last year and a profit of $423 million. Marchionne has said he believes Ferrari should be valued as a luxury brand and should be valued as high as $11 billion.

Contact Brent Snavely: 313-222-6512 or bsnavely@freepress.com. Follow him on Twitter @BrentSnavely.