April 17, 2012 / 10:45 AM / in 6 years

Audi to pay $1.12 billion for Ducati: sources

BERLIN/HAMBURG (Reuters) - Volkswagen’s (VOWG_p.DE) Audi premium-car division has agreed to buy Italian motorcycle company Ducati for about 860 million euros ($1.12 billion) including debt, two people familiar with the matter told Reuters on Tuesday.

Ducati’s liabilities are well below 200 million euros, one of the people said. Audi has reached a pact with Ducati’s main shareholder, Investindustrial and plans to announce the acquisition on Wednesday, sources told Reuters last week.

Analysts including Arndt Ellinghorst at London-based Credit Suisse questioned the industrial benefit of the Ducati purchase, saying it was an unnecessary sideshow to VW’s main challenges of integrating sports-car maker Porsche (PSHG_p.DE) and merging truck operations at MAN (MANG.DE) and Scania SCVb.ST.

    “The Ducati acquisition is driven by VW’s passion for nameplates rather than industrial or financial logic,” said Ellinghorst.

    Ducati will increase the VW group’s brand portfolio to twelve and extend Audi’s long-standing rivalry with Bayerische Motoren Werke (BMWG.DE) to superbikes. VW’s eleven-brand entity already makes everything from fuel-efficient city cars to 40-tonne trucks.

    Audi and Investindustrial may agree to withhold the exact purchasing price in the statement, which they plan to publish on the eve of VW’s annual shareholders’ meeting in Hamburg, one of the sources said.

    The people declined to be identified because the matter remains confidential.

    Editing by Helen Massy-Beresford

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