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Audi planning to buy Ducati for $1.1 billion

According to an insider speaking with the folks from Automotive News, Audi is planning the buy Italian motorcycle builder Ducati for the sum of around $1.1 billion – provided that the supervisory board at parent company Volkswagen approves the deal in a vote this Wednesday.
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The report states that Audi has reached an agreement with Investindustrial, the current parent company of Ducati, which would transfer ownership of the Italian superbike company to Audi for 860 million Euros ($1.1 billion USD). Although both Audi and Investindustrial have declined to comment further, this move has been rumored to be in the works for some time now. Also, Volkswagen Chairman Ferdinand Piech showed a great deal of interest in purchasing Ducati when the company was last on the market in 2008 but VW was eventually beaten out by current owner Investindustrial.

According to Automotive News, the price of $1.1 billion would value Ducati at roughly 7 times what the company made in 2011 and with the company will come around 200 million Euros ($283 million USD) in liabilities. Ducati sold around 42,000 motorcycles in 2011 with revenue of roughly 480 million Euros ($631 million USD).

Should the buyout of Ducati go through, the Italian motorcycle marquee with be the 11th brand in the Volkswagen Empire. The current passenger vehicle brands offered under the VW halo are Audi, Bentley, Bugatti, Lamborghini, Seat, Skoda and Volkswagen which are joined by commercial brands including VW Commercial Vehicles, Scania, and MAN. Ducati would be the first motorcycle offering from the modern Volkswagen Auto Group.

In addition to allowing the Volkswagen Auto Group to instantly be competitive in a new market segment in a variety of markets around the world, the purchase of Ducati would also give Audi a chance to compete with BMW in the motorcycle market. BMW has long sold a family of popular motorcycles of different types, making them among the most successful companies to offer both automobiles and motorcycles in the global market alongside the likes of Honda. The Volkswagen Group would surely love to be able to claim part of the motorcycle segment as their own and acquiring Ducati gives them a healthy leg-up in doing just that. Ducati is currently available in 65 countries and in addition to bringing about a new market segment, the Ducati brand brings with it over a half century of successful racing history.

Investindustrial first announced that they were considering selling the Ducati brand in February of this year. Early on, there were rumors that Mercedes Benz parent company Daimler wanted to acquire Ducati but that was quickly put down by the German automaker. The other main suitor for Ducati has been Indian motorcycle company Hero MotoCorp Ltd but if these new reports prove to be true – the Italian superbike builder will soon belong the a German luxury brand.

The final decision is set to be made by the Volkswagen supervisory board tomorrow (Wednesday April 18th), so within the next 48 hours, we should have a clear look at the future of the Ducati brand.

Source: Automotive News


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