Harley Davidson to bid for Ducati. Bids by private equity firms too are expected by next July

Rumors about Audi (Volkswagen group) selling Italy’s motorcycles maker Ducati are getting stronger.

Harley Davidson is actually said to have mandated Goldman Sachs to help in a bid for Ducati (see Reuters here), which is valued about 1.5 billion euros.

Also studying a bid for Ducati are Indian motocycles maker Bajaj Auto and meany private equity forms such as Kkr, Bain Capital  and Permira. Preliminary offers are expected to come by the end of July. 

The deal is said to have been in discussion since November 2015. Actually due to diesel emissions scandal, German automobile giant Volkswagen was said it might be forced to sell Italy’s motorcycle jewel Ducati in order to cash in for paying fines and future compensations to TDI cars’ owners (see here a previous post by BeBeez). Back then Ducati was said to have a 1.2 billion euros enterprise value.

In April 2012 Volkswagen (through Audi) bought Ducati from private equity funds Investindustrial (70%) and BS Private Equity (20%) and from Hospitals of Ontario Pension Plan (10%) for an enterprise value of 860 million euros (of which about 750 millions in equity value), winning a bid by German Mercedes, which bought then a 25% stake Italy’s motorcycle company Mv Agusta.

Volkswagen bought Ducati  after  the company had reached 480 million euros in revenues in 2011 and 94 millions in ebitda, with a net financial debt of 185 millions (but at the end of Q1 2012 net debt had dropped to 115 million euros).

Ducati sold 55.451 motorcycles in 2016 all over the world (642 motorcycles more than in 2015) with 731 million euros in revenues (from  702 milioni in 2016) and a 51 million euros operative result (from 54 millions in 2015) .