Daimler Truck Shares Surge on Frankfurt Market Debut
By Victoria Waldersee and Ilona Wissenbach
FRANKFURT (Reuters) -Shares in Daimler Truck climbed on their Frankfurt market debut on Friday following the commercial vehicle maker’s long-awaited spin-off from Daimler AG.
The split was announced in February and pitched by the two companies as an opportunity to unlock value in both Daimler Truck and the owner of Mercedes-Benz passenger cars and vans.
At 1023 GMT, Daimler Truck shares were trading at 29.88 euros, above their debut price of 28 euros. Daimler shares were up 3.7% at 74.83 euros.
“We are certain we will create value,” Daimler CEO Ola Kaellenius said, speaking to an emptier-than-usual hall in Frankfurt as pandemic restrictions limited the number of attendees.
“Trucks and cars have different requirements. We are thus unleashing the full potential of both companies,” he said.
Daimler Truck is targeting double-digit profit margins across the business in 2025, up from an expected 6-8% in 2021, with a particular focus on boosting its lagging European sales.
If it hits the double-digit target, it will prioritise investment in future technologies over boosting profits further, Daimler Truck CEO Martin Daum said in a roundtable with journalists after the listing.
“The fact that we still exist is due to two things: because the company has always made money, and there were hard times in between, and secondly, because we always invested in the future,” Daum said.
Daimler AG, soon to be renamed Mercedes-Benz AG, has kept 35% of Daimler Truck shares, while 65% were spun off on Friday. Shareholders in Daimler received one share in Daimler Truck for every two Daimler shares they owned.
Daimler Truck is now the world’s largest commercial vehicle maker by revenue, but its profit margins lag competitors like Traton’s Scania and Volvo Group’s Volvo Trucks.
Its performance is strongest in North America, where it reported an adjusted return on sales so far this year of 10.8%, compared to 7.2% in Asia and just 4.5% in Europe.
Its focus in coming years will be on boosting sales of electric trucks to 60% of all sales by 2030, including hydrogen and battery-electric models.
Meanwhile, Daimler said in a statement last week it had earmarked 60 billion euros https://www.reuters.com/markets/europe/daimler-supervisory-board-signs-off-60-bln-euro-investment-plan-mercedes-benz-2021-12-02 in spending for Mercedes-Benz between 2022 and 2026, focused on electrification, digitalisation and autonomous driving.
($1 = 0.8854 euros)
(Reporting by Victoria Waldersee, Ilona WissenbachEditing by Miranda Murray and Mark Potter)
