Volkswagen mulls selling Italian motorcycle maker Ducati
27 April 2017
German car maker Volkswagen (VW) is mulling selling Italian motorcycle maker Ducati Motor Holding SpA. as part of its plan to streamline operations to help fund a strategic overhaul following its emissions scandal, Reuters yesterday reported, citing two sources.
VW, Europe's largest carmaker, has hired investment bank Evercore to evaluate possible options including a sale of Ducati, the report said and added that no decision has been taken on a possible transaction and the carmaker might still decide to keep Ducati.
VW has already informed potential bidders and several strategic buyers have shown interest, the people told Reuters.
Ducati made annual earnings before interest, taxes, depreciation and amortization (EBITDA) of around €100 million and could fetch a valuation of up to €1.5 billion, or 15 times its core earnings - a multiple similar to that of Italian supercar maker Ferrari.
Potential buyers could be its peers in China, India's Hero or investors such as the consortium that bought British sports car maker Aston Martin in 2007, the report said.
Ducati is owned by VW's Audi division through its Italian subsidiary Lamborghini. VW had acquired the marquee brand in 2012 from private equity firm Investindustrial Holdings SpA, for about €860 million ($935 million).
Bologna, Italy-based Ducati was founded in 1926 by three brothers, Adriano, Marcello and Bruno Ducati, and started making radio components.
By 1935, the Ducati family had built their first factory and made the first Ducati 60cc motorcycle in 1950. The Ducati family lost ownership of the company in the same year, and since then Ducati Motorcycles has changed owners multiple times.
In 2005, Investindustrial Holdings, private equity firm BS Investimenti and Hospital of Ontario Pension Plan acquired Ducati from Texas Pacific Group.
Ducati currently produces motorcycles in six models, such as Superbike, Diavel, Hypermotrad, Monster, Multistrada, and Street Fighter and sells over 40,000 across the globe, with the US being its main market.
It also manufactures custom racing motorcycles for official teams, as well as for private race teams, and professional riders.
Ducati sells its motorcycles in more than 80 countries around the world with a primary focus in the European, North-American and Asian markets.