Ferrari hits starting blocks in IPO on Wednesday

Ferrari NV's initial public offering makes its debut on the New York Stock Exchange on Wednesday, with owner Fiat Chrysler Automobiles hoping it will burst out of the starting block.

Ferrari plans to sell as many as 18.89 million shares, 10 per cent of the company, at $52 a share, according to an Oct. 20 filing with the U.S. Securities and Exchange Commission.

Fiat Chrysler is hoping the listing will value the company founded in 1929 by Italian sports driver Enzo Ferrari at $10 billion.

Investors have lined up to buy the stock, meaning there could be a scramble for shares as they go public. Reports say shares are oversubscribed.

Ferrari plans to list under the ticker RACE, a choice that harkens to the racing pedigree of the legendary sports car maker.

Fiat Chrysler is hoping to raise some of the €48 billion ($70 billion Cdn) it needs to invest in expanding its Jeep, Alfa Romea and Maserati brands.

Spinning off a part of Ferrari will also help relieve Fiat Chrysler of some of its debt, as the parent company will receive 2.25 billion euros ($3.3 billion) from Ferrari before the spinoff.

Ferrari itself will continue to be a specialty car, with just 7,300 sold each year, mostly in Europe and the U.S. The automaker may raise its annual output to 9,000 cars, but still remain at the top of the luxury car market.

Fiat Chrysler plans to spinoff another 80 per cent of the company to its own shareholders, possibly next year, and Piero Ferrari, the son of the brand's founder, will retain 10 per cent.

The stock market volatility since China devalued its currency has played havoc with other IPOs.

Caribbean telco Digicel Group Ltd. cancelled a sale, First Data Corp. priced shares below a marketed range and Albertsons Cos. postponed its offering after failing to find a strong market.

While Sergio Marchionne, the CEO of Fiat Chrysler and CEO and chairman of Ferrari, has lamented the brand's Formula One performance over recent seasons, he can't complain about its financial track record.

Even when Ferrari didn't win on the racing circuit, it has been cashing in profits. Ferrari reported a net profit of €265 million (currently $390 million) last year, up 7 per cent from the previous year. Its net revenues have grown by seven per cent annually from 2005 to 2014.