Tuesday, April 17, 2012

Audi Buys Ducati for $1.12 Billion

ducati-1199-panigale-detail While rumors have swirled around this business venture, it is now out that Audi has agreed to buy Italian motorcycle giant Ducati for €860 million Euros, or about $1.12 Billion.

Two unnamed sources who are familiar with the case said that Ducati carries liabilities of less than €200 million Euros, (far less than originally believed) and that the official announcement of the sale will come out tomorrow. Audi will take control of the company as well as the debt, making Ducati the twelfth brand in the Volkswagen group.

It is a little curious as to why Audi would spend so much on Ducati, as the motorcycle brand is operating with quite a bit of debt. Financial analyst Arndt Ellinghorst of London-based Credit Suisse said, “The Ducati acquisition is driven by VW’s passion for nameplates rather than industrial or financial logic.” Another theory is that Audi values Ducati’s small engine technology, and is looking to incorporate it into its cars.

It would also seem that the Volkswagen group wants Ducati so that they can finally compete with cross town rivals BMW in the motorcycle market.

Auto Guide

News Update Users