BERLIN (Reuters) – Daimler AG will be formally renamed Mercedes-Benz Group AG on Saturday – nearly a year after the spin-off of its truck and bus division was announced – in a move its boss hopes will unlock shareholder value for the premium carmaker.
The change is the latest in a string of structural reshuffles for the carmaker which began its life as Daimler-Benz AG in 1926, bringing together Daimler Motor Company with engineering autos firm Benz & Cie.
The Mercedes brand, named after the daughter of an automobile entrepreneur, was officially adopted by Daimler AG in 1902.
“The goal is certainly to unleash the value potential of the company,” Ola Kaellenius told reporters on Friday, without naming a specific target valuation for the firm currently worth just under 77 billion euros($85.70 billion).
“We have a real chance to raise the multiple.”
Shares of Daimler Truck AG spun off from the newly anointed Mercedes-Benz last December last year, have risen slightly since their market debut to trade at 32.23 euros on Friday. Mercedes-Benz shares have risen since the spin-off was announced in February to their highest levels since 2015, reaching 74.25 on the day of the split, but have trended slightly lower since to trade at 71.15 euros.
The split was intended to provide pure-play investors with a more differentiated product as shareholders are increasingly rewarding legacy automakers, whose valuations are dwarfed by that of electric carmaker Tesla, for providing a clear electrification strategy of their own.
Asked whether automated driving was as significant to Mercedes-Benz as to Tesla, whose CEO Elon Musk said on Thursday he expected it to become Tesla’s main source of profitability, Kaellenius said:
“I share the opinion that there will more and more attractive use cases… it has significant business potential for us in the future.”
($1 = 0.8985 euros)
(Reporting by Victoria Waldersee, Ilona Wissenbach; Editing by Tomasz Janowski)
