MV Agusta has finally closed a very important funding round, getting equity investment from ComSar Invest, which is backed by the Black Ocean Group, which in turn is owned by Russian billionaire Timur Sardarov.
The move sees MV Agusta able also to repurchase its stock from Mercedes AMG, which previously owned a 25% stake in the Italian motorcycle manufacturer.
The details of the ComSar deal however have not been disclosed, though we do know that the deal includes enough cash to finish MV Agusta’s recapitalization plan with its creditors and to begin its new, more focused, business plan for new models and motorcycle production.
The future of MV Agusta has hinged on a crucial court decision for the past five months now – one that would allow the Italian motorcycle brand to restructure its debt, thus reducing its financial liabilities and freeing up a greater portion of its cash flow for continued production.
News comes today from Varese, Italy that a local court has approved MV Agusta’s new business plan, and allowed the motorcycle manufacturer to restructure its debts with creditors and suppliers.
This is positive news for MV Agusta, and it sets in motion a number of possibilities for the Italian brand, namely closing its investment deal with Black Ocean, an Anglo-Russian private equity firm.
To call the last couple of years for MV Agusta turbulent would probably be understating the situation.
The company has struggled for financial stability ever since its re-acquisition by the Castiglioni family, and that struggle has recently come to a zenith with the firms debt restructuring and investment by the Anglo-Russian investment group Black Ocean.
With that comes some harsh realities, namely that MV Agusta will not be producing a new superbike any time soon, as the cost of the project exceeds the Italian manufacturer’s capabilities – so said MV Agusta CEO Giovanni Castiglioni while talking to Alan Cathcart for Australian Motorcycle News.
Last week, I was ready to start polishing the obituary for MV Agusta – the Italian company seemingly in an impossibly terminal state.
Italy’s Guardia di Finanza had found that the Italian company had been using the social security contributions of its workers to pay down the money owed to parts suppliers (something MV Agusta disputes is the case), and earlier this year MV Agusta CEO Giovanni Castiglioni was investigated for irregularities on his tax return.
All of this is on top of the ever precarious financial situation MV Agusta has been in for the past year, which has resulted in the company looking to restructure its €50 million debt in the Italian court system, furlough a good portion of its workforce, and reduce its production volume to roughly 9,000 units per year.
Now it seems MV Agusta’s fortunes are changing, with the Italian motorcycle maker signing an agreement with the Black Ocean investment group to recapitalize MV Agusta.
Details of the pending transaction haven’t been released, but we can assume that the increase in capital will help ease MV Agusta’s relationship with suppliers, get workers back on the assembly line, and continue the development of new models.