Renault

-

 


Renault RNO 0.36%increase; green up pointing triangle is moving ahead with publicly listing Ampere, its electric-car unit, but some analysts think an IPO could be the wrong road forward.


The French automaker is setting Ampere up to become Europe’s top electric-vehicle producer by making cheaper cars than its rivals to attract more consumers than just the early EV adopters, according to Chief Executive Luca de Meo, who is also the head of Renault.


An IPO, scheduled for spring 2024, would help with focus and accountability that a company embedded inside Renault can’t offer, he said during a call with reporters earlier this month.


While analysts generally agree that Renault is right to separate the EV business from the 124-year-old car maker, they have questioned the decision for an IPO at a time of uncertainty around demand and pricing, and for a business that Renault said is fully funded.


Renault, which said it will own a “strong majority” in Ampere, risks diluting the share value for current investors, said Bernstein analyst Daniel Roeska. He said the move puts Renault’s long-term worth at stake. The car maker currently has a market cap of 10.3 billion euros ($11.28 billion).


“They’re cutting out terminal value in Renault, and they’re selling it in Ampere,” said Roeska. “And why would a Renault investor want to give up terminal value?”


Though De Meo said he is still open to alternatives, he and Renault CFO Thierry Pieton also said an IPO is the best way to raise money to accelerate growth and profitability and that it creates the conditions to eventually reward Renault shareholders.


“For our group stakeholders, raising cash at the Ampere level provides the best way to accelerate its development, and ultimately cash generation, without pulling on group resources,” Pieton said at Ampere’s capital markets meeting.

The Case-Shiller index, which measures repeat-sales data, reports on a two-month delay and reflects a three-month moving average. Homes usually go under contract a month or two before they close, so the September data is based on purchase decisions made earlier this year.


Mortgage rates have declined in recent weeks after hitting two-decade highs in October.


“Speeding up of annual home-price growth reflects much of the pent-up demand that exists in the housing market amid very low inventories,” said Selma Hepp, chief economist at CoreLogic. “Nevertheless, home prices are feeling the weight of high mortgage rates, which will slow the rate of price growth in the coming months.”

Comments

Post a Comment

Popular posts from this blog

Church’s Globe-Spanning Real-Estate Empire

-
Image
  Inside the Mormon Church’s Globe-Spanning Real-Estate Empire From Guam to Cape Verde, the Church of Jesus Christ of Latter-day Saints is using the financial cushion of its $100 billion investment portfolio to go on a temple-building spree A whistleblower revealed a few years ago that the Church of Jesus Christ of Latter-day Saints had an estimated $100 billion investment portfolio, and at the time, church officials called the holdings a rainy-day account. They now say the money also has provided a financial foundation that gives the Mormon Church confidence to construct more than 100 temples, from Cape Verde to Guam, a series of stone-clad monuments exhibiting the church’s vast and expanding wealth. In Pocatello, Idaho, a city of 56,000 in the rural southeastern corner of the state, a recently constructed temple stands at 71,125 square feet. Its polished limestone flooring was quarried in Bethlehem, the biblical birthplace of Jesus, and wood for its doors was imported from the Co...
Read more

tech companies

-
Image
 Good to know. The way tech companies continue to deliver ever-faster and more capable computers is undergoing a profound change—at the atomic level. Performance gains that were for decades accomplished mostly by shrinking the individual components on microchips—often described as Moore’s Law—are now increasingly the result of materials science, which is evolving faster than it has in decades. Santa Clara-based Applied Materials, founded in 1967, a year before Intel, is the biggest of the companies that are leading the way. It’s a change born of necessity. Chip makers are bumping up against a hard limit on how tiny the elements on chips can become, as some of their features can now be measured at the scale of just a few atoms. As a result, manipulating what materials are in these tiny machines, and how they’re connected to one another, has become a primary way that engineers can continue to make them faster and more capable. Applied Materials AMAT 0.72%increase; green up pointing t...
Read more