Motorcycle racing is a profitable business, it turns out. The leading UK financial paper Financial Times reported yesterday that Bridgepoint Capital, the private equity firm that owns Dorna, among many other assets, has hit upon a relatively novel way of paying out investors, by transferring the roughly 40% of Dorna that it owns between one Bridgepoint fund and another.
The proposed sale is a result of a review carried out by merchant bankers Lazard at the end of last year, with the aim of fixing a value and finding potential buyers. According to the FT, several private equity firms expressed an interesting in buying Bridgepoint’s stake, including former owners CVC.
Here is some interesting automotive news for you that has bearing over our two-wheeled world, as CNN is reporting that more Americans are behind on their car loans than ever before.
The news accounts for two trends that we are seeing in the United States. One, the decline of automobile ownership; and two, the rising debt load amongst citizens, especially millennial buyers.
What this translates into the car world – namely that buyers are increasingly defaulting on their auto loans – likely bears the same reality in the motorcycle industry, since so many motorbikes are bought through financed payment schemes.
It surprising to us that there is so little investment in technologies and business in the two-wheeled space by the established players.
Maybe it is the conservative nature of the motorcycle industry, or maybe it is because motorcycle companies are just miserably bad at corporate development. Whatever the reason may be, it makes today’s headline an intriguing one.
This is because Yamaha Motor Corp. in Japan has just set aside $100 million to invest in technologies and business startups, over the next 10 years.
It has been a busy month since our inaugural edition of “What We’re Reading” column, so there is plenty to catch-up on reading-wise. Again, our reading list spans stories that go between the motorcycle industry and also non-endemic media outlets.
This edition focuses heavily on the racing world, and in it we get a glimpse into the world of the MotoGP Championship, from the riders’ perspective. We also see what’s happening in the automotive industry, as well as the media landscape as a whole.
Many of our stories can be brought back to the motorcycle industry, as our industry faces analogous problems to other sectors. Of course, some of the pieces made our list simply because I thought they were interesting and thought-provoking.
Part clearinghouse for stories that we will never get our full attention, and part book club for our loyal readers who are doing their best to survive the work day, say hello to the next installment of the “What We’re Reading” column series.
The Volkswagen Group got a new CEO last week, and in less than seven days, that news has already sparked renewed rumors in the German automobile conglomerate divesting itself of Ducati Motor Holdings.
For those who have been following Ducati’s saga, there was much talk last year of Volkswagen selling off a number of its other brands, all under the reasoning that the German company would need to raise capital to cover its mounting Dieselgate liabilities.
The logic for that reasoning wasn’t sound, but the actions were certainly there, with Volkswagen tendering offers from a number of would-be suitors.
There was a fly in the ointment though: Volkswagen’s labor unions, who control half of the VW Group’s board seats, and were vehemently opposed to any brand divestitures.
Because of the unions, any sale – including Ducati’s – was a non-starter for the Volkswagen executives, though that didn’t keep the warring factions from trying. By the end of last year though, it seemed we had put this issue to bed. 2018, however, is a new year.
The Yamaha Corporation announced today that it will be selling 8 million shares of its holdings in Yamaha Motor Co., a movement of shares that will see roughly 2.3% of the voting power in the powersports company changing hands.
This deal is expected to close on December 4th, and the Yamaha Corporation says that it will be selling its position to various unnamed securities companies, presumably to then be sold on the open market.
At the current market price for Yamaha Motor stock, this deal should be worth close to ¥26 billion, and ¥18 billion after tax expenses have been factored.
For the past few months, talk of Ducati’s divestiture from the Volkswagen Group has grabbed the attention from news outlets and Ducatisti alike, as the future of the Italian motorcycle company seemed uncertain.
Internally, a power struggle was a play, with Audi keen to unload Ducati from its books, but lacking the support from upper management in the Volkswagen Group.
Talks reportedly hit the skids once it was realized that the Volkswagen labor unions, which control half of the seats on the Volkswagen Group management board, weren’t onboard with divesting Ducati from the holding group.
This is probably information that investors would have liked to know, before they spent the time and resources putting together purchase proposals for Audi’s consideration.
Now, with no change in the position of VW’s labor unions, and with the possibility of an internal consensus seemingly out of sight, it seems talk of Ducati’s divestiture have stalled, with little chance of them resuming this year.
According to several reports in the financial sector, the investors behind Dorna Sports S.L. are readying themselves for another sizable payout from the media rights holder for the MotoGP and WorldSBK Championships.
Using a bit of financial finesse, the move would see Bridgepoint Capital and the Canada Pension Plan Investment Board (CPPIB) – the two major investors in Dorna Sports – taking roughly €889 million off the books of the Spanish media company, according to Reuters.
As such, today’s news would make this the third time that Bridgepoint and the CPPIB have raided the piggy bank for motorcycling’s premier racing series, having done similar deals in 2011 (€420 million) and 2014 (€715 million).
If you have had your eye on a Norton V4 superbike recently, you might not have to wait as long for it to arrive, as the British marque has secured £3 million from the Santander Corporate & Commercial bank.
The debt investment will allow Norton to triple its production rate on the V4 SS and V4 RR models, and also allow for the company to hire 40 new employees for the job. Additionally, according to Norton this will allow the company to increase its production volume to 1,500 motorcycles per year.