What it means
Exor is a holding company, which means it owns shares in other businesses instead of making products itself. Its portfolio has included stakes in carmakers, a luxury sports car brand, a football club, publishing and insurance, so its value depends mainly on the value of the companies it owns.
Investors therefore track its net asset value rather than looking at sales or profit in the usual way. Elkann took on a leading role in the family business at a young age, after the deaths of his grandfather and great-uncle.
Under his leadership the group has moved away from its historic reliance on the car business and has reshaped its portfolio by selling some holdings and buying others. Active portfolio management of this kind is the main job of a holding company's leadership.
He has also held chair roles at companies in the group, including the luxury sports car maker Ferrari and the carmaker Stellantis. These roles show how a holding company can exercise influence over its main investments through the board.
Such board seats allow the holding company to shape strategy, capital allocation and the choice of senior managers. For finance readers, the Exor story is a case study in how holding companies are valued.
Analysts compare the market value of the holding company's shares with the net asset value (NAV) of its underlying stakes. The usual finding is a discount, because investors worry about layers of cost and limited ability to sell large stakes.
A family-controlled holding company can also take a long view. It does not face the quarterly pressure of some funds, and it can support its businesses through downturns.
The downside is that outside shareholders may have little say, and decisions can reflect family priorities. Take care with detail on holdings and roles, as these change when deals complete.
Always check the latest company filings rather than relying on a summary. The same caution applies to rankings of wealth or influence.
In practice
Real-world examples.
Example
A fund analyst compares a family holding company with the value of the listed shares it owns. The holding company trades at a 30% discount, so she asks whether buybacks or asset sales could narrow it. She also checks how much of the discount is explained by running costs and taxes.
Example
A business school case discusses a founding family that has moved from a single industry into a diversified portfolio. Students debate whether the new mix of holdings reduces the family's risk. The class concludes that diversification and succession planning were as important as the businesses themselves.
Example
A private banker advises a client whose family owns a manufacturing business. He explains how a holding company can hold shares in several firms, centralise decisions and make succession easier. Wealthy families often choose this structure for the same reasons.
Formula
Calculation
Net asset value discount = (Net asset value - Market value of the holding company) / Net asset value
Suppose a holding company owns stakes worth $40 billion in total, but its own market value is $30 billion.
Discount = ($40 billion - $30 billion) / $40 billion = $10 billion / $40 billion = 25%
The market values the holding company at 25% below the sum of its parts. If management closes the gap through buybacks or by selling stakes, shareholders could gain. In practice, analysts often compare the discount with its own history, since a persistent gap says more than a single day's price. Share buybacks funded by selling stakes can narrow the gap, but only if the sale price is close to the stated value.Case study
Seen in the real world.
This is a fictional illustration. Valmont Holdings, an invented family holding company, owned stakes in a carmaker, a bank and a media group worth $6 billion in total.
Its shares, however, were valued by the market at only $4.2 billion. The new chief executive, Giulia, calculated a 30% discount and tested several ways to narrow it, including a buyback and selling a minority stake to fund distributions.
Over two years, the holding company sold its media stake and bought back shares. The discount narrowed to 18%, and in this illustrative story, shareholders benefited because management treated the gap as a performance measure. The board agreed to publish the net asset value every quarter so investors could track progress.
Watch out
Common mistakes.
- Assuming a holding company is worth the sum of its stakes. The market often applies a discount for costs, taxes and limited liquidity.
- Equating family control with poor governance. Family owners can be patient and committed, though minority shareholders should check protections. Strong families can be good long-term owners, but outsiders must check voting rights.
- Treating a summary of holdings as current. Stakes change with every deal and listing.
Questions
People also ask.
What is Exor?
It is the holding company of the Agnelli family, owning and investing in stakes across several industries. Its value is closely linked to the performance of the companies it owns.
Why do holding companies trade at a discount?
Investors worry about extra costs, tax leakage and the difficulty of selling large stakes at full value. This is called a holding company or conglomerate discount.
What is net asset value?
It is the total value of a company's assets minus its liabilities, often used for holding companies and funds. Analysts update it regularly using market prices and valuations.
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