Exclusive: VW eyes possible sale of motorbike brand Ducati - sources | Reuters

By Arno Schuetze | FRANKFURT FRANKFURT Volkswagen is considering a possible sale of Italian motorcycle maker Ducati as Europe's largest carmaker seeks to streamline operations to fund a post-Dieselgate strategic overhaul, two people familiar with the matter said.Volkswagen (VW) is reigning in spending across all areas of group-wide operations including by cutting thousands of jobs at its core passenger-car brand to fund a multi-billion-euro shift to embrace electric cars and new mobility services.VW has tasked investment banking boutique Evercore with evaluating possible options including a sale of the thoroughbred brand, which its luxury division Audi acquired for about 860 million euros ($935 million) in 2012, the sources said.While Wolfsburg-based VW has started reaching out to potential buyers to sound out their interest, no decision has been taken on whether the firm will be divested, they added.VW referred to Audi for comment. Audi and Evercore declined to comment.One of the sources said Ducati has annual earnings before interest, taxes, depreciation and amortisation (EBITDA) of roughly 100 million euros and could fetch a valuation of 1.5 billion euros, or 15 times its core earnings, a multiple similar to that of Italian supercar maker Ferrari

Reuters April 26, 2017 23:18:09 IST
Exclusive: VW eyes possible sale of motorbike brand Ducati - sources
| Reuters

Exclusive VW eyes possible sale of motorbike brand Ducati  sources
 Reuters

By Arno Schuetze
| FRANKFURT

FRANKFURT Volkswagen is considering a possible sale of Italian motorcycle maker Ducati as Europe's largest carmaker seeks to streamline operations to fund a post-Dieselgate strategic overhaul, two people familiar with the matter said.Volkswagen (VW) is reigning in spending across all areas of group-wide operations including by cutting thousands of jobs at its core passenger-car brand to fund a multi-billion-euro shift to embrace electric cars and new mobility services.VW has tasked investment banking boutique Evercore with evaluating possible options including a sale of the thoroughbred brand, which its luxury division Audi acquired for about 860 million euros ($935 million) in 2012, the sources said.While Wolfsburg-based VW has started reaching out to potential buyers to sound out their interest, no decision has been taken on whether the firm will be divested, they added.VW referred to Audi for comment. Audi and Evercore declined to comment.One of the sources said Ducati has annual earnings before interest, taxes, depreciation and amortisation (EBITDA) of roughly 100 million euros and could fetch a valuation of 1.5 billion euros, or 15 times its core earnings, a multiple similar to that of Italian supercar maker Ferrari.

A banker close to the industry said potential buyers were likely to offer Volkswagen an earnings multiple of more than 10.The motorbike group may appeal to peers such as Chinese groups, India's Hero or investors such as the consortium which bought British sports car maker Aston Martin in 2007, the sources said.Private equity firms could also raise their hand for the brand, whose motorcycles have won the Superbike racing competition 17 times, the sources said.

It remained unclear whether large competitors such as Harley Davidson, Kawasaki or Honda could be interested, they said.Analyst questioned Audi's purchase of Ducati when it was announced in April 2012, saying the move bore no economic or industrial logic and solely reflected former Volkswagen Chairman Ferdinand Piech's passion for the Italian company's expertise on design and light engines.But Piech, the main advocate of the deal, has since bowed out as group chairman and agreed earlier this month to sell the bulk of his stake in the Porsche SE family holding that controls VW to his younger brother.

VW said last June it would review its portfolio of assets and brands, which rekindled views among analysts that "non-core" businesses such as Ducati or a diesel-engine business for machinery could be up for sale.Chief Executive Matthias Mueller, asked by Reuters at the March 14 annual press conference whether this review has since yielded any conclusions, said the carmaker still had nothing to announce. Ducati posted sales of 593 million euros in 2016, according to Audi's annual report. ($1 = 0.9194 euros) (Additional reporting by Andreas Cremer and Irene Preisinger; Editing by Maria Sheahan)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

Greek police clash with protesters in rally against mandatory vaccinations
World

Greek police clash with protesters in rally against mandatory vaccinations

ATHENS (Reuters) - Greek police used teargas and water cannon to disperse people who had gathered in central Athens on Saturday to protest against mandatory COVID-19 vaccinations. More than 4,000 people rallied outside the Greek parliament for a third time this month to oppose mandatory inoculations for some workers, such as healthcare and nursing staff.

Two Turkish soldiers killed in attack in northern Syria
World

Two Turkish soldiers killed in attack in northern Syria

ISTANBUL (Reuters) - Two Turkish soldiers were killed and two were wounded in an attack on their armoured vehicle in northern Syria, and Turkish forces immediately launched retaliatory fire, Turkey's defence ministry said on Saturday. "Our punitive fire against terrorist positions is continuing," the statement on Twitter on said. It did not specify where the attack occurred, but media reports said it was in the al-Bab area.

Brazilians take to streets again to demand Bolsonaro's impeachment
World

Brazilians take to streets again to demand Bolsonaro's impeachment

By Marcelo Rochabrun SAO PAULO (Reuters) - Protesters took to the streets in several Brazilian cities on Saturday to demand the impeachment of far-right President Jair Bolsonaro, whose popularity has fallen in recent weeks amid corruption scandals against the backdrop of the pandemic. This week, news broke that Brazil's defense ministry told congressional leadership that next year's elections would not take place without amending the country's electronic voting system to include a paper trail of each vote. Bolsonaro has suggested several times without evidence that the current system is prone to fraud, allegations that Brazil's government has denied