FRANKFURT (Reuters) - Volkswagen (VOWG.DE) said on Monday its truck unit Traton should by year-end be in shape for a potential stock market listing, which is expected to take place in mid-2019.
The company’s supervisory board decided on Monday to convert Traton’s legal structure to a Societas Europaea (SE) and to shortly mandate investment banks and legal advisors for a possible initial public offering, Volkswagen said in a statement.
Volkswagen is targeting proceeds of more than 6 billion euros ($7 billion) with a potential listing of its truck and bus subsidiary, the division’s chief executive had said earlier this year.
Volkswagen has said in the past that it is considering a listing or partial listing of the trucks division, but that this would not happen in 2018.
The cars and truck segments only have synergies in procurement, Chief Financial Officer Frank Witter said.
“Therefore, a separation of the operations makes sense. We have decided to take the next step to prepare (Traton) for a possible IPO,” he said, adding that final decisions would be taken pending the state of capital markets.
By listing on the stock market, further expansion would be easier thanks to new refinancing possibilities. A flotation could also allow Volkswagen Truck & Bus to build a war chest to buy out (NAV.N) Navistar completely, a U.S. truck maker in which it already owns a 16.85 percent stake.
($1 = 0.8568 euros)
Reporting by Arno Schuetze; Editing by Michelle Martin