Officially Official: Audi’s Board Approves Ducati Acquisition

04/18/2012 @ 12:22 pm, by Jensen Beeler24 COMMENTS

Officially Official: Audis Board Approves Ducati Acquisition audi ducati 635x347

As expected from yesterday’s news, Audi’s Board of Directors has approved the German car company’s acquisition of Ducati Motor Holding. While the grumblings from Ducati owners have already emerged over the news breaking yesterday, in reality the move is a boon for Ducati, which will receive access to an almost limitless bank account, global business expertise, and advanced manufacturing techniques.

Selling 42,000 motorcycles last year, Ducati has typically struggled to sell more than 30,000 units annually, a figure which is highly regarded as the Italian company’s break-even point. Historically selling under that amount, Ducati has racked up considerable debt from its operation, hence why nearly a quarter of the company’s purchase price is going to its outstanding financial liabilities.

For Ducati owners and Ducati fans around the world, the acquisition by Audi and the Volkswagen Group should be met with more resounding praise, as it means an increased layer of stability has been added to the Italian brand. While the hyperbole has been flowing online, we imagine that the first motorcycles sales success to come from the company post-acquisition will silence any resistance to the company’s new German ownership.

As irrelevant as that metric actually is in business terms, the reality is that Audi’s influence over Ducati will take several years to be fully realized, as it takes a considerable amount of time for new products to come to market, and business plans to be implemented. Press releases from both Investindustrial and Audi are after the jump.

Press Release from Investindustrial:
April 18, 2012 – International Motorcycles S.p.A, a subsidiary of the Investindustrial Group (“Investindustrial”), has today agreed to the sale of Ducati Motor Holding S.p.A (“Ducati”) to Audi AG, part of the Volkswagen Group. The acquisition is subject to antitrust clearance.
Ducati, founded in 1926 and based in Borgo Panigale (Italy), is a leading motorcycles designer and manufacturer which boasts a rich racing heritage in the MotoGP World Championship and the Superbike World Championship.

In 2011, Ducati sold 42,200 units, resulting in an 11% global market share, and generated revenues of €480 million at the best-in-class profitability.
Since the acquisition by Investindustrial in 2006, Ducati has been turned around with great success into one of the best and most profitable motorcycle brands in the world. The company successfully launched a globalisation process which led the company to open a factory in Thailand in 2011 and to expand into new fast growing markets, such as Brazil, China and India. As of today, 80% of Ducati’s sales come from foreign markets and at the end of 2011 the Group recorded the highest turnover and EBITDA in its history.

The creation of industrial value is demonstrated by strong growth across the company: under Investindustrial’s ownership, Ducati’s revenues grew from €305 million in 2006 to €480 million in 2011, EBITDA rose from €27 million in 2006 to €94 million in 2011 and resulted in positive EBIT of €51 million from €5 million in the year of the acquisition. The number of employees increased from 1,043 in 2006 to 1,135 in 2011.

In recent years, under the guidance of the management team, led by CEO Gabriele Del Torchio, Ducati has also developed the most exciting and up-to-date product range in its history by launching 17 new models including the Multistrada 1200 in 2010, the Diavel in 2011 and more recently the Panigale superbike. These achievements have contributed to a significant increase in motorcycle sales, rising from 35,300 in 2006 to 42,200 at the end of 2011.

Ducati also achieved great success in the world of racing: in Super Bike, Ducati won 4 Riders World titles (2006, 2008, 2009 and 2011) and 3 Constructors World titles (2006, 2008 and 2011) and a total of 68 wins. In MotoGP, Ducati won 28 races, a Riders World title and a Constructors World title in 2007. Andrea C. Bonomi, Chairman of Investindustrial commented:

“Ducati has thrived with us as a result of the intensive industrial turnaround and the commercial push into new, fast-growing markets. We are convinced that the company will continue to provide a bright and rewarding future to its customers and employees in the very capable hands of Audi. We believe that Audi is the best partner to continue the globalisation process that has already been successfully initiated.

The management team, led by Gabriele Del Torchio, and the Ducati’s skilled and passionate workforce have been a key element in turning the company into a global brand with some of the most exciting motorcycle models currently on the market. I am convinced Audi will be a responsible new owner, preserving the Italian workforce’s

technology skills for a bright future for the Company. Ducati has a loyal and growing customer base, which will be well looked after thanks to Audi and Volkswagen Group’s global presence and engineering excellence.

This transaction is the second purchase in only a few months of an Investindustrial group company by a strategic buyer, the other being the sale of the leading cladding and architectural envelope group Permasteelisa to JS Group of Japan.”

Audi’s decision to acquire Ducati confirms the effectiveness of Investindustrial group’s strategy of investing in Italy, which is home to many quality companies. These companies are poised to develop into globally-operating and high-quality brands if properly guided and nurtured.

Hospitals of Ontario Pension Plan, a leading Canadian investor and BS Investimenti, also sold their stakes in Ducati to Audi AG.

Studio Chiomenti advised the seller on legal matters.

Press Release from Audi AG:
AUDI AG acquires sports motorcycle manufacturer Ducati Motor Holding S.p.A.

Ingolstadt/Bologna, April 18, 2012 – AUDI AG is acquiring from Investindustrial Group the tradition-steeped Italian sports motorcycle manufacturer Ducati Motor Holding S.p.A., which has its registered office in Bologna. The transaction will be completed as quickly as possible once authorized by the competition authorities. The Supervisory Boards of AUDI AG and Volkswagen AG approved the acquisition today in Hamburg. Ducati is known worldwide as a leading brand in motorcycle manufacture, with outstanding expertise in engine development and lightweight construction.

Alongside the traditional Italian brands Lamborghini and Italdesign, Ducati is now a third pillar for AUDI AG in Northern Italy. Another building block in the Company’s growth strategy thus falls into place. Rupert Stadler, Chairman of the Board of Management of AUDI AG, declared: “Ducati is known worldwide as a premium brand among motorcycle manufacturers and has a long tradition of building sporty motorcycles. It has great expertise in high-performance engines and lightweight construction, and is one of the world’s most profitable motorcycle manufacturers. That makes Ducati an excellent fit for Audi.” The progressive control systems and special combustion chamber process of Ducati engines, their resulting sporty character, and Ducati’s extensive know-how in lightweight construction thus offer great potential for AUDI AG and the Volkswagen Group.

Peter Mosch, Chairman of the General Works Council of AUDI AG, explains that the employee representatives of AUDI AG support the Company’s sustainable, co- determined growth strategy. “We must use the opportunities offered by globalization for Audi – and that’s exactly what we’re doing. Everyone at Audi is looking forward to working with our new colleagues from Ducati,” commented Mosch.

Ducati is a globally active company and has manufacturing operations at its headquarters in Bologna and at its own factory in Thailand. It maintains a series of importer companies in strategic markets. Experts predict that the motorcycle market will enjoy strong growth over the next few years, especially in Asia. In 2011, Ducati sold around 42,000 motorcycles and generated revenue of some €480 million, employing around 1,100 people.

The company was founded by Adriano and Marcello Ducati in Bologna in 1926. Known originally as Società Scientifica Radiobrevetti Ducati, it initially built parts for radios. It ventured into the manufacture of motorcycles in 1949.

Ducati has been actively involved in motorcycle racing for many decades through its racing division Ducati Corse. Its racing activities are currently focused on the Ducati official factory team in the MotoGP class of the Motorcycle World Championship and in the Superbike World Championship, supporting competitive private teams. Ducati won the manufacturers’ championship in this latter class 17 times in 21 championships and the pilots’ 14 times.

Source: Audi, Ducati, & Investindustrial

Comment:

  1. Gritboy says:

    Audi’s definitely going to benefit from the some of Ducati’s tech too. Sounds like a win-win unless you’re a purist.

  2. Keet says:

    as a mulit-billion dollar company, what “tech” does Ducati have that VW/Audi isnt already privy to?

  3. jeff says:

    I think this is very good news for ducati. Look at what audi has done with Lamborghini. The style, soul and passion of an Italian supercar is still very much there, and with audi technology the performance and engineering is world class. If the same is in store for ducati good things are sure to come.

  4. Walt says:

    This will be a successful marriage as long as VW/Audi stays out of the Ducati design office, and resist the temptation to inject their own DNA into Ducati.

    Audi can help Ducati tremendously on the production and manufacturing engineering side, not the design engineering side. There is a big difference between designing a competitive motorcycle engine, and a car engine, Audi has nothing to offer Ducati in that regard, and should stay out of it.

    They also need to keep the Italian and German personalities separate, using only the best of each one.
    The Italian’s design flare, inspiration, creativity and passion, with the German’s efficiency, attention to detail, quality and resourcefulness.

    If Audi understands that, it’ll be a happy and successful marriage.

  5. Halfie 30 says:

    Audi/VW will not be able to “resist” staying out of the Ducati R&D office if they want profit. This is why is is going to make Ducati go south. I think people who think this is a good marriage don’t quite understand that. Thinking Ducati can stay pure, or that just using “VW” productiOn methods will help Ducati are missing the big picture. VW mass production is their down fall.

  6. Jim says:

    I fear that Halfie is closest to the truth regarding Ducati’s future.

  7. 2ndclass says:

    Yeah, they’re totally fucked. I mean look at Lamborghini, now that they’re part of Audi they’re building cars that can take on the world’s best and selling them in numbers that total the entire production numbers of past models in a single year.

    Absolute ruined. Ducati has no chance.

  8. Wow! RT @Asphalt_Rubber: Officially Official: Audi's Board Approves Ducati Acquisition – http://t.co/QX9Qo4Tx #motorcycle

  9. froryde says:

    ” I mean look at Lamborghini, now that they’re part of Audi they’re building cars that can take on the world’s best and selling them in numbers that total the entire production numbers of past models in a single year.”

    Bad for the Ducatisti. But hey, great if you just want a Ducati.

  10. Officially Official: Audi's Board Approves Ducati Acquisition – http://t.co/UZR71lkC #motorcycle

  11. Dr. Gellar says:

    I fear that Halfie isn’t really that close regarding Ducati’s future. As jeff and 2ndclass mention, Lamborghini doesn’t seem any worse for wear being owned by the VW Group. Ducati should be no different.

  12. Lumengrid says:

    @Keet: Reason in below
    “Ducati is known worldwide as a leading brand in motorcycle manufacture, with outstanding expertise in engine development and lightweight construction.”

    Audi wants this tech as downsizing trends grows in car industries :)

    @Dr. Gellar: Fully agree with you on this. I think that Ducati will be nurtured as Lamborghini was/is :) I think that Ducati will be well off with this deal and Audi will not want to kill the fanbase Duacti has.

  13. Damo says:

    Here’s to hoping Audi hooks Ducati up with more money to go racing. I want a full factory backed team in WSBK again and I just want to see Nicky and Rossi win a few races.

    Humble requests I think.

  14. Keet says:

    Lumengrid, there’s PR speak, and then theres reality. Look at VW/Audi’s portfolio, for street and for racing, there is NOTHING that Ducati knows that VW/Audi doesnt already. EXCEPT for maybe single-sided swingarm technology (tongue planted firmly in cheek).

  15. Lumengrid says:

    Keet, of course there is a PR speak in it but truth is that motorcycle manufacturers are years in front at developing lightweight/high performance engines then car producers and there is slight difference in knowing things and having patent for it :)

    Look at Ford promoting their new boostec engines (capacity/power ratio). Next step for them is 180 hp from 1 liter.

    Honda already has access to this tech so have BMW and Suzuki. Even Toyota looked into this:

    “In 2000, Toyota and Yamaha Corporation made a capital alliance in which Toyota paid Yamaha Corporation ¥10.5 billion for a 5 per cent share in Yamaha Motor Company while Yamaha and Yamaha Motor each bought 500,000 shares of Toyota stock in return”

    Althought Toyota is already building one of the best small capacity engines in the world.

  16. Keet says:

    from Jalopniks article:
    “You’ll also be hearing speculation of VW gaining technology from Ducati. Specifically stuff about small engine technology. That is a tempting rabbit hole to speculate down. Ducati makes 1199cc engines that make 195bhp. VW makes 1.6 liter engines that make 100bhp. Plug Duc technology into that Polo and every wins, right? Right? Guys? Again, a company at Ducati’s level – 40,000 bikes as opposed to over 8 million cars and trucks – simply does not have technology that the bigger company doesn’t.

    They don’t have more talent or any secret alien technology. Motorcycle engines play a very different game to car engines. Sure they have higher specific power outputs, but they do so at a higher price (the engine is a higher percentage of total vehicle cost on a motorcycle), with much higher emissions, much lower service intervals and exponentially lower outright lifetimes. If VW started selling Golfs that went 175mph, but cost $75,000, got 8mpg, required $5,000 services every 4,000 miles and blew up after 20,000 miles, VW would be in a lot of trouble, right? That’s before you even factor in emissions standards, which are far more lenient for motorcycles than they are for cars.”

  17. Keet says:

    as someone in the automotive enginneering field, most motorcycle tech trickes down from auto. not all, but most.

  18. Lumengrid says:

    Tech comes down from auto you say?

    ABS – http://en.wikipedia.org/wiki/Royal_Enfield_Super_Meteor althought the idea really comes from airplane industry but Royal Enfield tried and tested it before any car, could use it but pull the plug on it :)

    But to the subject of Audi and Ducati:

    We can speculate here all we can as well as Jalopnik did, on what Audi gains but time will tell. Surely the motorcycle engine is diffrent but I would never assume that Audi will plant motorbike engine in one of their cars :) but its as well about access to R&D power and brains that Ducati has as the fact that they are buying a well established brand which they can market to new hights as they did with Lambo.

  19. Singletrack says:

    DUCAUDI !!

    PR Bumpf aside, this is a marketing move, not an engineering one.

    I think it’s just the top brass at VW posturing and going directly after competitors (BMW) in every market class possible. VW/Audi competes car-for-car in the – 1, 3, 5, 6, 7, 8 etc. series’.

    Now that Euro bikes are stomping the Japanese in profits, VW wants into the game. BMW Motorrad was the begining of BMW and contributes to profits. In a decade or two, when the economic winds change, there will be no historcal laurels for VW to rest on, and VW will sell off Ducati.

    I’ll eat my words if VW cars show up with desmo valve V-Twins, but I think I’m safe.

  20. Steve says:

    Why did they only count from 2006+ for the figures listed for WSBK?Anyway they didn’t win the riders championship in 2009, it was a Yamaha with Benny boy on board. The riders and manufacturers numbers are arse about for 2006+.

    [quote]
    Ducati also achieved great success in the world of racing: in Super Bike, Ducati won 4 Riders World titles (2006, 2008, 2009 and 2011) and 3 Constructors World titles (2006, 2008 and 2011) and a total of 68 wins.
    [/quote]

    I’m not a Ducati fan but count way more than 4 Riders World titles in total. Fogarty alone won 4,why were the other years left off?

    1990: Roche 851
    1991: Polen 888
    1992: Polen 888
    1994: Fogarty 916
    1995: Fogarty 916
    1996: Corser 916
    1998: Fogarty 916
    1999: Fogarty 999
    2001: Bayliss 996R
    2003: Hodgson 999F03
    2004: Toseland 999F04
    2006: Bayliss 999F06
    2008: Bayliss 1098F08
    2011: Checa 1098R

    They won 17 constructors titles.

  21. Keet says:

    well, shit, if you’re gonna throw in aerospace… but how much moto tech has trickled into aero??? obviously you own a Ducati (or possibly work for them), i have owned a few myself, Ducati does things differently, differently doesn’t necessarily mean better.

    R&D?? you’re right, the R&D department that have helped win a ton of Le Mans and ALMS races can surely learn a thing or two about chain drives and single-sided swing arms. Wait, i hear Ducati has the first motorcycle with LED headlights, maybe Audi can learn from that…? ;) Dont even mention the desmo valve action, that was actually designed by a german years ago, if it was actually that great, everyone would be using it.

  22. hac says:

    why do the articles never say what it really is…. VW Group Buys Ducati, since they own Audi. I guess Saying Audi makes it seem more high class. They should’ve said ‘Lamborghini buys Audi’, that would’ve sounded even cooler, lol

  23. Hac, I could go into an explanation of cost-based accounting, but won’t. Short-version though, it was Audi’s free cash from operations that paid for Ducati.

    As for the tech side of it, everyone seems to be forgetting that VW just bought 20% of Suzuki in order to get small-displacement motor tech. There’s nothing I see in this deal that centers around Ducati being purchased for R&D, but to say there is nothing that a car manufacturer like Audi can learn from a motorcycle manufacturer like Ducati is bordering on the over-statement of the century.

  24. Lumengrid says:

    Keet: I do not own Ducati (Honda is my thing…I know I sound boring but their stuff does trick for me)
    and quite honestly wouldn’t mind working for them or other major motorbike comapny for that matter.
    Actually I work for company that does products which most likely saved loads of lifes of riders that have bad luck to crash and seriously injured themselves.

    Jensen as to your last point you spoke whats on my mind which maybe I failed to explain to Keet clearly. Hell I might be wrong about buliding engines and such but it could be about working with lightweight materials, testing stuff and having some patents that would be icing on the cake for Ducati.