US Business

Germany luxury carmaker Porsche is gunning for a blockbuster IPO on the Frankfurt Stock Exchange this week. Here are five facts about the automobile giant: 

– Dial 911 –

Porsche made waves at the Frankfurt international motor show in 1963 when it unveiled a new car with a six-cylinder engine designed to succeed its 356 model. 

The manufacturer originally intended to call it the 901 — but Peugeot had already laid claim to all the three-digit numbers with a zero in the middle, prompting Porsche to settle for 911. 

The number is now strongly linked to the brand — to call the company, 911 is on every phone number after the local dial code. The company’s capital amounts to 911 million shares, and its shares will be traded under the code P911.

– Electric car pioneer –

Volkswagen, the parent company of Porsche, has launched a well-publicised drive to dump combustion engines — but in fact, it produced its first electric vehicles over a century ago. 

At the Porsche museum in Zuffenhausen, southern Germany, a kind of old stage coach described as the first Porsche in history is on display.

Built in 1898 by the company’s founder Ferdinand Porsche, the “Egger-Lohner C.2 Phaeton” ran on electric power. 

Two years later, Porsche unveiled a new model the “Lohner-Porsche”, a petrol-electric hybrid. 

– On screen – 

Porsches have made regular appearances on the silver screen over the years. One of the best-known instances is the 1971 movie “Le Mans”, starring Steve McQueen as Michael Delaney, an American driving a Porsche 917 against a German rival in a Ferrari at the famous 24-hour race in France. 

In the 1995 cop film “Bad Boys”, Will Smith’s character drives a 911 Turbo, as he and a fellow detective investigate the theft of a massive haul of heroin from a police vault. 

One of Hollywood star Tom Cruise’s earliest hits, 1983 teen comedy “Risky Business”, features a Porsche 928. Cruise’s character is forbidden from driving the car while his parents are away — but he does just that, and it ends up sinking into a lake. 

In “Scarface”, Al Pacino — playing a Cuban immigrant who becomes a powerful drug lord in Miami — also drives a Porsche 928. 

– And in motorsports – 

Porsche is one of the world’s biggest race car manufacturers. After enjoying moderate success with early models on long-distance races in the 1950s and 60s, the 917 drove the manufacturer to a coveted first victory at the Le Mans 24 Hour Race in 1970, an event it has triumphed in repeatedly since.

The iconic 911 has done particularly well in rallies, including the Monte Carlo rally. 

The manufacturer has also raced in Formula One. They had a team from 1957-62, although they only raced in two complete seasons 1961/62, with their only victory Dan Gurney’s in the 1962 French Grand Prix.

They returned to the circuit in 1983 providing the engines for the McLaren team and enjoyed great success — McLaren won two successive constructors championships in 1984 and 1985.

However, its negotiations with Red Bull for a partnership that would have allowed them to return to F1 failed earlier this month. 

– Porsche and Piech – 

The Porsche-Piech family are the main shareholders of the Volkswagen group, and have roots in Germany’s auto industry stretching back decades.

An Austrian-born engineer, Ferdinand Porsche was founder of the luxury car brand that bears his name. In addition, he created the Volkswagen Beetle and designed the iconic, open-top Mercedes-Benz SSK sports car. 

During World War II, he contributed to the German war effort by helping produce weapons systems, and was a member of the Nazi party. He died in 1951. 

Ferdinand Piech was the grandson of Ferdinand Porsche. Chief executive of VW from 1993 to 2002, he helped to transform the group into a global auto giant in the face of fierce competition, particularly from rivals in Asia. 

He reorganised the group and cleaned up its books at the cost of tens of thousands of jobs, and was a notoriously tough manager nicknamed “the emperor” and “the patriarch” by German media. 

He died in 2019. 

Luxury sports carmaker Porsche will this week race onto the Frankfurt stock exchange in what is set to be one of Europe’s biggest listings in years, seeking to defy recent market turbulence.

While the listing comes at a difficult time for global markets — roiled by the war in Ukraine and surging inflation — the maker of the 9-11 sports car expects to leverage its brand power. 

“Some potential clients may not yet be able to afford a Porsche, but they can buy the shares,” said Lutz Meschke, deputy chairman of the company’s board.

Parent company Volkswagen hopes Thursday’s flotation will raise up to 9.4 billion euros ($9.2 billion) and are targeting a valuation of up to 75 billion euros for Porsche.

Some of the cash will be ploughed into Volkswagen’s high-speed drive towards electric vehicles, which has brought the legacy carmaker into more direct competition with US rival Tesla.

In terms of value of shares issued, Porsche’s is set to be the biggest stock market debut in Germany since Deutsche Telekom’s in 1996, and the largest in Europe since the 2011 flotation of Switzerland-based commodities giant Glencore.

Analysts are looking to the carmaker’s market entry for some cheer in a morose economic backdrop.

“The Porsche AG IPO may offer a catalyst in an industry sorely lacking positive surprises,” Berenberg said in a note.

“Volkswagen’s luxury sports car business holds brand power and electrification momentum in the most desirable automotive segments.”

– Electric drive –

The IPO will see 114 million shares of “Porsche AG” listed, with a price range between 76.50 and 82.50 euros per share. 

VW’s targeted valuation is below some earlier estimates — but should still catapult it above rivals such as BMW, with a valuation of 49 billion euros, and Mercedes-Benz, with a 61-billion-euro price tag. 

The maker of the iconic 911 sports car has joined the electric drive of Volkswagen group, whose brands also include Audi and Skoda, in earnest. 

The electric “Taycan” has been the brand’s best-selling model since January, an electric version of the “Macan” is due in 2024, as well as the launch of a new SUV in the middle of the decade.

The electric strategy — launched by former VW chief Herbert Diess — includes building battery factories across Europe and the US.

The IPO will see preferential shares sold to investors, which have no voting rights, while Volkswagen will also sell 25 percent of the carmaker to Porsche SE. 

The eponymous company is a listed holding controlled by the Porsche-Piech family, who in turn are the main shareholders in Volkswagen.

This means that Porsche SE will have a blocking minority that will allow it to steer the future of the company.

– Major investor interest –

While there is much anticipation ahead of the Porsche IPO, concerns surrounding governance have been brewing at Volkswagen.

The dual role of recently appointed group CEO Oliver Blume  — who has maintained his position as Porsche chief, as well as taking on the top job at Volkswagen group — has in particular raised eyebrows. 

Nevertheless, the listing has generated interested among major investors, including Qatar and Abu Dhabi’s public investment funds, Norway’s sovereign wealth fund and US asset management firm T. Rowe Price. 

They will together hold about 3.6 billion euros in preferential shares, with Qatar making the biggest investment.

Volkswagen hopes that listing a minority stake in Porsche will push up its own stock market value, which is currently about 90 billion euros — just a fraction of Tesla’s, at just under $900 billion.

Casino stocks soared in Macau on Monday after authorities announced plans to gradually welcome back tour groups from the Chinese mainland, the demographic that makes up the vast majority of punters.

Macau is the only place in China where casinos are legal and the former Portuguese colony used to dwarf Las Vegas for the scale of bets placed each month.

But China’s strict zero-Covid controls have laid waste to the gaming sector, hammering the city’s economy and its main source of revenue.

Some much-needed relief came on Sunday when city leader Ho Iat-seng said Macau would start allowing group tours from mainland provinces, as well as easier e-visa rules for mainlanders, from November.

Gaming stocks surged the most in six months on Monday morning, with a Bloomberg Intelligence gauge of the city’s six licensed casino operators showing overall gains of more than 10 percent. 

Sands China led the pack, soaring more than 18 percent, SJM holdings rose more than 14 percent while Wynn Macau was up 10 percent.

Ho said tour group rules would initially be eased for the neighbouring mainland province of Guangdong, followed by other major population centres including Shanghai, Zhejiang, Jiangsu and Fujian.

Daily visitation numbers, he added, could rise to 40,000, compared with just 11,000 in August.

But Macau will not, for now, follow Hong Kong which last week announced it was finally scrapping mandatory hotel quarantine for international travellers.

Instead the city will remain largely closed to overseas visitors, maintaining a seven-day hotel quarantine policy.

Even if pandemic measures are fully lifted it is unlikely Macau’s casinos will see a return to their headiest, freewheeling days.

Chinese President Xi Jinping has spearheaded an anti-corruption campaign that has seen increased scrutiny of the high-rollers and officials who travel to gamble in Macau, where cases of money laundering are common.

Macau’s six operating concessions are currently up for renewal. 

Earlier this month all the current operators made bids alongside a seventh newcomer, a company controlled by Malaysian tycoon and Genting chairman Lim Kok Thay.

At Ulaanbaatar’s Naiman Sharga money exchange market, elderly women stand in the street waving wads of money at passers-by, encouraging them to change foreign currency to Mongolian tugriks.

Each transaction nets them a small profit — but when the value of the tugrik fluctuates it makes that more difficult, and lately the currency has taken a dive. 

This year the currency has fallen almost 15 percent against the US dollar — most of that since the start of Russia’s invasion of Ukraine.

Angara Banerji, the International Monetary Fund’s mission chief, listed a raft of factors behind the country’s inflation, including a rise in domestic meat prices, China’s border restrictions, surging oil and food prices, and an increase in transportation and logistical costs for imports.

The declining currency has pushed up the cost of everyday goods for a country struggling to navigate global economic headwinds caused by transportation bottlenecks and inflationary pressures, war and economic uncertainty. 

“The rate is going down dramatically because of the war in Ukraine and the coronavirus,” said Ts. Maisaikhan, a currency trader who operates inside the market. 

“We don’t produce much ourselves, most things are imported, so when the dollar goes up the price of everything goes up too.”

Like elsewhere in the world, Mongolia’s inflation has soared this year and reached 14.4 percent in August, compared with 9.5 percent during the same month in 2021, according to the country’s National Statistical Office.

Prices for food and beverages increased by about a fifth on-year in August — the same rate as medicine and health care — while the cost of clothing, utilities and housing also went up.

“Inflation has surged sharply since mid-2021 and has exceeded the Bank of Mongolia’s target band,” said Banerji.

Last summer there were a few weeks when potato prices temporarily tripled after China closed the border over Covid-19.

Next to the money exchange offices lies Urt Tsagaan (Long White), a pedestrian mall filled with jewellery makers, seamstresses, hairdressers, boot repair stalls, cobblers, and tattoo studios. 

In a sewing shop near the money exchange, Sukhbaatar Tuya said she buys some meat and vegetables each day but when prices spike suddenly it just means buying less produce. 

“We’re just going day by day,” she said. “We don’t have any plans beyond the next three days or a week.”

“We have to live like this,” she said. “There is no other way.”

The pound hit a record low against the dollar Monday on surging fears about the UK economy after the government unveiled a huge tax-cutting budget.

The selloff came as most equity markets across Asia fell again owing to a growing expectation that central bank interest rate hikes to fight runaway inflation would lead to deep and painful recessions.

Officials in several countries including the United States, Britain, Switzerland and Sweden unveiled more increases in the cost of borrowing.

The moves sent equity markets deep into the red again after officials reiterated their focus on fighting inflation, even if that means causing a recession.

But the biggest casualty of the week was the pound, which fell below $1.10 for the first time since 1985 as new finance minister Kwasi Kwarteng announced his controversial mini-budget.

It then extended the losses Monday to an all-time low of $1.0350 in Asian trade after he said he intended to unveil further reductions, despite his budget causing ructions on London’s markets.

It also fell to a two-year low against the euro, though the single currency remains under pressure against the dollar, sitting at 2002 levels.

Now, observers are warning that the pound could fall to parity with the greenback.

Kwarteng, who was put in place by Liz Truss after she became prime minister earlier this month, said he planned to slash taxes to kickstart the British economy and provide cash to cushion families from rocketing energy costs.

But investors were spooked by the huge amount of borrowing likely needed for the multibillion-pound package, which critics said would benefit the rich far more during a cost-of-living crisis.

“Whether or not the UK government announcement of the biggest tax reduction since 1972… will in time yield a significant growth dividend is not something markets are yet willing to contemplate,” said National Australia Bank’s Ray Attrill.

“Instead, they were consumed by worries over the scale of near-term UK government financing needs, at a time when the current account deficit is running at more than eight percent of GDP.”

He added: “Chatter about a possible UK sovereign rating downgrade has already begun.”

And former US treasury secretary Lawrence Summer was scathing of Britain’s recent monetary policy decisions.

“It makes me very sorry to say, but I think the UK is behaving a bit like an emerging market turning itself into a submerging market,” he told Bloomberg Television’s Wall Street Week last week.

“Between Brexit, how far the Bank of England got behind the curve and now these fiscal policies, I think Britain will be remembered for having (pursued) the worst macroeconomic policies of any major country in a long time.”

The collapse in sterling came as markets across the world are sent into a spin by recession worries caused by a sharp tightening of monetary policy by central banks fighting decades-high inflation. 

The retreat in London was mirrored in Europe and New York, where the Dow hit a two-year low, and Asia followed suit.

Tokyo shed two percent as traders there returned from a long weekend break, while Sydney, Seoul, Singapore, Taipei and Jakarta also tanked.

But Hong Kong rose as traders welcomed news that the city had relaxed strict hotel quarantine measures for travellers, providing a much-needed boost to the embattled economy.

Macau casino stocks led the way as the city said it would accept Chinese tour groups again from November, having been blocked during the pandemic.

Shanghai stocks also rose.

Oil prices edged up slightly, though barely made a dent in the big losses suffered Friday as expectations that a recession is looming hammer demand expectations.

– Key figures at around 0230 GMT –

Pound/dollar: DOWN at 1.0570 from 1.0852 on Friday

Euro/pound: UP at 91.38 pence from 89.28 pence 

Euro/dollar: DOWN at $ 0.9656 from 0.9695

Dollar/yen: UP at 143.82 yen from 143.31 yen

Hong Kong – Hang Seng Index: UP 0.2 percent at 17,970.69 

Shanghai – Composite: UP 0.1 percent at 3,091.82 

Tokyo – Nikkei 225: DOWN 2.0 percent at 26,619.53 (break)

West Texas Intermediate: UP 0.5 percent at $79.13 per barrel

Brent North Sea crude: UP 0.4 percent at $86.52 per barrel

New York – Dow: DOWN 1.6 percent at 29,590.41 (close)

London – FTSE 100: DOWN 2.0 percent at 7,018.60 (close) 

Superstar Rihanna will headline the Super Bowl halftime show in February, the main event sponsor Apple Music announced Sunday.

The move marks a long-awaited return to performing for the singer, who had previously turned down the gig in protest.

“IT’S ON. @rihanna will take the stage for the first ever Apple Music Super Bowl Halftime Show on 2.12.23,” Apple Music said in a tweet featuring a photo of the musician’s raised hand holding a football.

Rihanna, 34, and the NFL tweeted the same image.

The Barbadian-born Robyn Rihanna Fenty in recent years has become a billionaire, parlaying her music achievements into successful makeup, lingerie and high-fashion brands.

She made history by becoming the first Black woman to head a fashion house for the French powerhouse LVMH, which owns legacy brands including Fendi and Givenchy.

For the past few years, the singer behind the hits “Diamonds” and “Umbrella” has put music aside, at least publicly, to focus on her various businesses.

In January, she and rapper A$AP Rocky, 33, announced they were expecting a child with a set of glamorous snow-dusted images taken in Harlem.

They reportedly welcomed the baby, a boy, in May. No other details, including the child’s name, have been made public.

– Return to music –

Rihanna’s fierce fan base has been clamoring for her ninth album, “R9,” which she has said will be “reggae-infused” and has hinted since 2019 is nearly finished.

Performing at the Super Bowl is an about-face for the singer, who in 2019 confirmed reports to Vogue that she had turned down the NFL’s offer to play the coveted halftime show in solidarity with former player Colin Kaepernick.

Kaepernick, who has not played in the NFL since opting out of his contract with the San Francisco 49ers in March 2017, began kneeling in protest of social injustice and racial inequality during pre-game renditions of the US national anthem six years ago.

“I couldn’t dare do that. For what? Who gains from that? Not my people. I just couldn’t be a sellout. I couldn’t be an enabler,” she told the magazine in an interview.

Rihanna’s Super Bowl performance will follow an impeccably choreographed 2022 halftime show that featured rap legends including Dr. Dre, Snoop Dog and Eminem.

The 2021 halftime show featured Canadian artist The Weeknd, while Jennifer Lopez and Shakira performed the year before.

The halftime show has since 2019 been produced by Roc Nation, founded by New York rapper-turned-businessman Jay-Z.

Apple Music announced in September that it would be the main sponsor of the event, ousting Pepsi and reportedly paying $50 million for the privilege.

The 2022 Super Bowl, in which the Los Angeles Rams defeated the Cincinnati Bengals, drew an average of 112.3 million viewers on television and streaming, according to NBC Sports.

The United Arab Emirates agreed Sunday to supply natural gas and diesel to Germany as part of an “energy security” deal to replace Russian supplies.

Emirati industry minister Sultan Ahmed Al Jaber called it a “landmark new agreement” that “reinforces the rapidly growing energy partnership between the UAE and Germany”, at a signing attended by German Chancellor Olaf Scholz, the UAE’s state news agency WAM reported.

Scholz signed the deal while on a Gulf tour that took him to the UAE, Saudi Arabia and Qatar hunting for new energy sources.

He met with Emirati President Sheikh Mohamed bin Zayed Al-Nahyan, who said on Twitter they had discussed “cooperation in areas including energy security, emissions reduction and climate action”. 

The German leader said he “welcomed” the “energy security” agreement, WAM said.

UAE state oil company ADNOC completed its first direct diesel delivery to Germany this month, and will “supply up to 250,000 tons of diesel per month in 2023”, it reported. 

The first delivery of 137,000 cubic metres of liquefied natural gas will be made in December at Germany’s new floating LNG import terminal at Brunsbuettel, near Hamburg, the RWE energy firm said in a statement.

ADNOC will make more LNG deliveries to Germany in 2023, WAM said. 

Scholz’s two-day Gulf tour aimed to seal new energy deals to replace Russian supplies and mitigate the energy crisis resulting from Moscow’s invasion of Ukraine. 

On Saturday, he met Saudi Crown Prince Mohammed bin Salman in Jeddah.

On Sunday afternoon, following his trip to the UAE, he held talks in Doha with Qatari Emir Sheikh Tamim bin Hamad Al-Thani on energy and investment, according to an official statement.

No deals were announced in Qatar however. The two countries are locked in tough talks on the length of contracts for LNG supplies, according to German media, and Scholz said he wanted to see progress.

Scholz said Qatar’s controversial rights record was improving but did not commit to attending the World Cup in the Gulf state that starts in November.

– Energy transition –

Scholz’s stop in the UAE included a tour of an environmental project at a mangrove park with Emirati climate change minister Mariam Almheiri. 

Almheiri said discussions would cover “climate action and economic growth” as well as energy supplies. 

“The UAE believes all three pillars must go hand in hand. We cannot look at one or two of these pillars separately,” she said.

The UAE, Saudi Arabia and Qatar have been critics of what they call unrealistic energy transition models they say have contributed to shortages that have hit Europe in the past two years.

Scholz told reporters in Abu Dhabi that his country had “made progress on a whole series of projects here in terms of the production and purchase of diesel and gas”, while adding it was determined to avoid energy dependence on Russia. 

“The fact that we are dependent on one supplier and also dependent on its decisions will certainly not happen to us again,” he said. 

“With the investments that we are now making in Germany, and that will become reality bit by bit next year, we will indeed have an infrastructure for gas imports for Germany, such that we are no longer directly dependent on the specific supplier at the other end of the pipeline, as we are with a pipeline connection.” 

Scholz ended the tour in Qatar one day after France’s TotalEnergies signed a new $1.5 billion deal to help expand Doha’s natural gas production. 

The German chancellor said such projects were “important”. 

“We have to ensure that the production of liquefied gas in the world is advanced to such an extent that the high demand that exists can be met — without having to fall back on the production capacities in Russia that have been used so far,” he said.