Exor Reduces Ferrari Stake by 4% in €3 Billion Sale to Fund Future Investments

Exor (EXOR.AS), the holding company of Italy’s Agnelli family, has sold a 4% stake in Ferrari (RACE.MI) for approximately €3 billion ($3.14 billion), the company announced on Thursday.

The move is part of Exor’s strategy to diversify its investment portfolio and create financial flexibility for a significant future acquisition.

The sale, which was disclosed late Wednesday, aims to reduce Exor’s concentration in Ferrari while maintaining its position as the automaker’s largest shareholder. Even after the transaction, Exor retains a 20% stake in Ferrari and holds 30% of the company’s voting rights.

“Our commitment to remain Ferrari’s largest shareholder for the long term is stronger than ever,” said John Elkann, CEO of Exor and chairman of Ferrari.

The deal will not affect Exor’s shareholder agreement with Piero Ferrari, son of company founder Enzo Ferrari, ensuring that their combined voting rights remain close to 50%.

Exor intends to allocate the proceeds from the share sale across several initiatives:

• €1 billion buyback program: A portion of the funds will be used to repurchase Exor shares, enhancing shareholder value.
• Future acquisition: The company has stated that the majority of the remaining funds will be used for a substantial new investment, though details on potential targets have not yet been disclosed.

Following the announcement, Ferrari shares dropped 7% in early trading after closing at €483 on Wednesday, near their record high. Meanwhile, Exor’s Dutch-listed shares rose by 2.7%.

As part of its own buyback program, Ferrari repurchased nearly 667,000 of its shares for about €300 million in the transaction.

Exor has been actively diversifying its portfolio beyond its traditional automotive holdings. The investment firm remains the largest shareholder in Stellantis and Dutch multinational Philips, while also maintaining control over industrial manufacturers Iveco and CNH, Serie A football club Juventus, and various interests in healthcare, luxury goods, technology, and media.

This transaction comes amid a broader surge in European block trades, with investors capitalizing on high stock valuations. So far in 2024, around $15.3 billion has been raised through similar stake sales.

With input from Reuters, the Wall Street Journal, and Bloomberg.