March 13 (Bloomberg) -- Audi AG is in talks to buy Ducati Motor Holding SpA, the maker of luxury motorbikes ridden by celebrities such as Brad Pitt, from owner Investindustrial SpA, according to two people familiar with the matter.
Audi, which has the right of first refusal on a purchase until mid-April, is considering a total price of about 850 million euros ($1.12 billion) for the Italian company, said one of the people, who declined to be identified discussing private negotiations.
Volkswagen AG Chairman Ferdinand Piech first publicly expressed interest in buying Ducati in April 2008, eventually losing out to current owner Investindustrial. Purchasing Ducati would add a motorcycle maker to VW’s nine brands, which include the Audi, Skoda and Lamborghini auto marques as well as heavy truckmakers Scania AB and MAN SE. Ducati would complement Audi’s luxury-car lineup with products such as the $28,000 Superbike 1199 Panigale S Tricolore.
“You really have to push the envelope to see obvious benefits for a car company to own a motorcycle business,” said Erich Hauser, a London-based analyst at Credit Suisse Group AG. One could be forgiven for seeing this as “just another attempt by VW in empire building,” he said.
Ducati, which sold about 42,000 bikes last year, posted a 39 percent increase in earnings before interest, taxes, depreciation and amortization to 93 million euros in 2011, said a person familiar with the financial figures, who declined to be named because the results have not yet been released. Revenue rose 20 percent to 480 million euros.
The Milan-based private equity company may hold an initial public offering of Ducati in Hong Kong this year or sell it to a rival, two people familiar with the plans said last month. Investindustrial is still considering both an IPO and the sale of the company and no final decision has been taken on the matter, a person familiar with the plan said today. The Bologna based-company was delisted from the Milan exchange in 2008.
Ducati’s total liabilities are less than 200 million euros, a spokesman for Investindustrial said today, declining to be identified by name, citing company policy. He declined further comment.
Audi must still do due diligence on the potential deal and is about halfway through what will likely be about a two-month process, one of the people said. Christine Ritz, head of VW investor relations, said the carmaker doesn’t comment on market speculation
Hero MotoCorp Ltd., India’s biggest motorcycle maker, said March 5 that Ducati is one of the assets it’s examining as it looks for acquisitions to expand overseas.
Bayerische Motoren Werke AG, which already makes motorcycles under the BMW brand, and Daimler AG both said today they have no plans to bid for Ducati.
“We’re very happy with our existing cooperation between AMG and Ducati,” Marc Binder, a Daimler spokesman based in Stuttgart, said in an interview. “We’re not interested in a takeover of the company.”
Volkswagen Chief Executive Officer Martin Winterkorn said yesterday at the carmaker’s annual meeting that he keeps his eyes open to what’s for sale on the market, when asked about whether VW was interested in buying Ducati.
Ducati, which was founded in Bologna in 1926, sells its Superbike, Monster, Streetfighter, Hypermotard, Multistrada and the new Diavel in 65 countries.
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