Will Exor become a luxury finance company? In a certain sense it already is, given that it ranks first among the portfolio companies Ferrari with a value of 8,6 billion dollars, the Redhead which boasts multiples on the market closer to brands than to the auto sector. Not to mention the recent shopping in China, where John Elkann bet an 80 million chip on the brand shang xia enhanced by his friend Axel Dumas, current leader of Hermès, or even more on the stiletto heels of the maison Christian Louboutin, half a billion euros. But it is not at all certain, reading the accounts for 2020, that Elkann intends to bet too much in a sector which, net of Ferrari, is worth only 2% of Exor's Gross Asset Value (asset value plus debt). against a total net asset value of 29,5 billion euro.
During the year marked by the marriage of FCA with Peugeot and the following birth of Stellantis, in fact, the lawyer's nephew has also set off in other directions, as well as on the paths of the designer labels. He has invested 200 million dollars in With, the New York mobility app, and as many ended up in Exor Seeds which invests in early stage companies (38, for now) in the footsteps of American friends: Jeff Bezos, among other things editor of The Washington Post as John is ofEconomist, and Elon Musk himself, another point of reference in that America which has always been the model to imitate, from Henry Ford for his great-grandfather Senator to David Rockefeller for his grandfather a lawyer.
In short, it is not said that the future of Exor speaks only the language of luxury. Even because the core business for now remains the car. La Ferrari more than Stellantis (7,4 billion dollars) of which, however, Exor controls only 14,6% of the capital after handing over the operational leadership to Carlos Tavares. As well as controls 26,9% of Cnh Industrial, which is negotiating the sale of Iveco and a stake in the FPT Industrial Powertrain division to the Chinese of Faw which would produce more cash for the shareholders. No, it's not an escape from the industry, but the need to rebalance the portfolio focusing on anti-cyclical assets, able to compensate for the fluctuations of a sector that has always been fluctuating, In perspective even more, if one thinks of the environmental problems that will inevitably impact on the automotive world. Or the capital absorption that the new electric mobility will entail and beyond.
It should contribute to guaranteeing an anti-cyclical future PartnerRe, the reinsurance purchased by Elkann on the advice of Warren Buffett which, in truth, Elkann has already tried to resell to the French of Covea who at the last moment, thanks to the pandemic, reconsidered, giving up an 8 billion deal. Elkann, who for the occasion refused a discount to the transalpine group, has entrusted the leadership of the company to Jacques Bonneau for a relaunch based on algorithms and sophisticated technologies. Without anxiety or haste also because there is no reason to raise cash on the horizon. Even in a difficult year like 2020, in fact, the heritage of the safe of the Agnelli/Elkann group grew (3,34 billion euro). The red at the end of the year, a loss of 30 million euros to be linked to the liabilities of Cnh Industrial and Juventus, did not prevent the board of directors from maintaining the dividend unchanged compared to 2019 by detaching a 100 million coupon to be submitted to the vote of the next shareholders' meeting on 15 April. It means 53 million for what used to be the Agnelli family limited partnership with its three main branches (Elkann, Nasi and Agnelli) and their direct descendants.
Without to forget the extra dividend collected on the occasion of the birth of Stellantis which still guarantees a considerable cash firepower: if we add up the extraordinary dividend paid by Stellantis in the merger, the distribution of the coupon and that of cash and Faurecia shares, only from Stellantis will it to Exor just over a billion. Exor's investment capacity will therefore be around 3 billion until 2023. Net of the check for Louboutin, this means that Exor can spend, even immediately, 2,5 billion of Euro. But to do what? Perhaps something will be understood from the letter to the shareholders that will be made public in a few days, in the run-up to the meeting on April 15, in Warren Buffett style. For the occasion it will be understood whether John, born in New York, high school in Paris, intends to follow the French path or that of his American friends. Unless, much to his spite, he is forced to spend a chip on remedy the accounts of Juventus in case of failure to qualify for the Champions League.
