December 1, 2019

blogger - Stock Market Float or Not

During the Cannes boat show 2019 pleasure motor yacht and super yacht builder Ferretti Group, which is today made of eight brands; Ferretti, Ferretti Custom Line, CRN, Itama, Mochi, Pershing, Riva, and Wally announced that by the end of the year it was gonna float in the Milan stock exchange.  Ferretti Group is possibly the largest Group as in versatility existing in the yachting market offering a diverse product range from flybridge motor cruisers and yachts, super yachts, sport cruisers and yachts, super sport yachts, traditional cruisers and yachts, and now even performance sailing craft with the purchase of Wally in 2018.
This decision to float was reverted and cancelled less to a month after announcement, with Ferretti Group saying that deteriorating market conditions in the stock market as the prime reason of cancellation.  The Ferretti Group has been very healthy in recent years and onward from 2014.  The Ferretti Group received a 250 million Euros cash injection in 2019 by its major share holders; Chinese Weichai Group, and F Investments of Piero Ferrari.
This decision might have also surprised other boating brands as Princess, Sanlorenzo, and Sunseeker all being rumoured to be interested in floating in the stock market in the near future.  It will be interesting to see if any of these will follow on the plan, or will cancel it completely.  To be fair I think boating and the stock market are a very difficult proposition, due to the volatility of the boating industry, from performing beyond expectations in good times, and going really negative in bad times.  
It is also true though that some have done it with success for many years as Beneteau Group, and Brunswick, and also giant USA boat dealership MarineMax.  But lets be fair, the portfolio of the three above is mostly geared toward the entry level sector of the market where a boat has the price of a medium sized sedan car.  Ferretti Group, Princess, Sanlorenzo, and Sunseeker are into the luxurious part of the market, where some of the entry level models cost you the price of a new luxurious sedan car just for general maintenance in a year.

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