Italian luxury sportscar maker Ferrari is accelerating towards a stock market listing after its parent Fiat Chrysler Automobiles (FCAU) filed for an initial public offering on the New York Stock Exchange.

After the listing, Fiat Chrysler’s subsidiary will be known as Ferrari NV. in New York.

Ferrari IPO expected in early 2016

As detailed by ValueWalk, Fiat Chrysler Automobiles NV unveiled its plans last year to list a 10% stake in luxury brand Ferrari and issue $2.5 billion in convertible bonds to fund the parent company’s turnaround plan.

Fiat bought 59% of Chrysler out of bankruptcy in 2009. Subsequently, Fiat acquired full control of Chrysler in 2014 and decided to combine all its businesses under the Fiat Chrysler Automobiles NV. It took over seven years before Chrysler could return to the U.S. stock market after it merged with Daimler AG (DDAIF) AG to form Daimler Chrysler.

Interestingly, Fiat Chrysler Automobiles NV received a tepid response from investors during its first day of trading on Wall Street last October.

In a regulatory filing with the U.S. Securities and Exchange Commission, Fiat Chrysler Automobiles indicated that it would create a Dutch-registered holding company for Ferrari and list its shares on Wall Street. It has estimated the supercar division’s value at over $11 billion and plans to complete the separation in early 2016.

IPO to boost FCA’s coffers

Fiat Chrysler Automobiles’ chief executive Sergio Marchionne indicated last year that Ferrari’s listing would happen by mid-2015. However, during the intervening period, the process has been complicated with a delay over a tax ruling, forcing the car marker to wait at least a year from the joint listing of Fiat and Chrysler to book any gain from selling shares in Ferrari.

The spinoff forms part of Marchionne's plan to reduce the larger company's debt load while funding an ambitious €48bn investment plan.

Fiat Chrysler said about 10% of the “prancing horse” mark will be listed, and a further 80% of the shares distributed among Fiat Chrysler’s existing shareholders. The remainder is held by Piero Ferrari, son of the founder Enzo Ferrai.

However, it hasn’t released details about the number of shares that will be offered or the price range.

As in FCA’s case, Ferrari’s float will also include a loyalty share scheme for long-term investors, set to tighten the grip on the company by Fiat’s founding Agnelli family.

Through their holding company Exor and Piero Ferrari, the Agnellis could end up with a voting power of just under 51%, enabling them to ward off any unwanted takeover bid.

A successful Ferrari listing would bolster FCA’s finances at a time when its search for a merger partner to help with dwindling margins and high development costs appears to have fallen on deaf ears.

Bill Visnic of Forbes believes the Ferrari spin-off is guaranteed to be the most high-profile IPO of the year, and many financial types anticipate the shares to go 0-to-60 faster than the cars themselves once public trading begins.

UBS AG is the global coordinator for the proposed listing, as well as joint book runner alongside Bank of America Merrill Lynch and Santander.