Ferrari and Mubadala Development Company - a principal investment company wholly owned by the Government of Abu Dhabi - have announced the purchase of a five percent stake in Ferrari by Mubadala from Mediobanca.
The deal sees Mubadala pay EUR114 million to purchase five percent of Ferrari from Mediobanca, valuing Ferrari at a total of EUR2.28 billion. The agreement provides also for an earn out in favour of Mediobanca in case the IPO of Ferrari is completed within the next 24 months, at a price ensuring to Mubadala an Internal Rate of Return above 10%.
"This is the first time that we, Fiat, have welcomed a non-financial institution to become a Ferrari shareholder. The key benefit of extending our shareholder base beyond traditional financial institutions will be a new opportunity for our development", said Luca di Montezemolo, Chairman of Ferrari and Chairman of Fiat (56 percent majority shareholder in the Italian luxury brand). "We know Mubadala is committed to being an extremely reliable, stable shareholder and partner to existing shareholders," he added.
"Moreover, the strategic alliance with Mubadala, and therefore the Government of Abu Dhabi, is set to bring us compelling and dynamic new strategies especially in the Middle East and North African markets. Our initial areas for consideration will range from the creation and development of road and racing car testing initiatives, along with professional driving schools through to the leveraging of opportunities around brand experiences and merchandising".
Sheikh Hamed bin Zayed Al Nahyan, Chairman of the Abu Dhabi Department of Planning & Economy said, "This is a sound financial and strategic investment on numerous levels. It continues our track record of being involved with premier global companies and brands who are the leaders in their fields". "Importantly, it also meets our own investment objectives that include the creation of blue chip commercial partnerships that will directly and indirectly benefit the Abu Dhabi economy", he added.
"Through Mubadala, the Abu Dhabi Government has a track record of investment, involvement and positive contribution to premium projects and selected companies around the world. We are therefore proud of their involvement in Ferrari", added Mr. Montezemolo.
Piero Ferrari, who owns 10% of the company, stated "I know Abu Dhabi well. I have had the opportunity to meet government representatives, His Highness and his family and I am therefore happy to welcome them into the Ferrari fold".
Commenting on the relationship, Khaldoon Khalifa Al Mubarak, CEO of Mubadala said, "This deal further underscores our strategy of involvement in profitable relationships with premiere global companies and brands. For both Mubadala and Ferrari, the primary business objective is to create long-term, commercially viable opportunities that maximise all potential aspects of the strategic alliance. I am very much looking forward to seeing the potential we have at hand realised", he added.