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Royal Enfield to bid almost $2bn for Ducati India

07 September 2017

The move prompted several or more bidders, including Italy's Benetton family, United States automotive firm Polaris Industries, and Ducati's former owner Italian company Investindustrial to express dismay in the process.

India's Eicher Motors Ltd (NS:), maker of Royal Enfield classic motorbikes, is set to make a binding takeover bid for Italian motorcycle manufacturer Ducati for $1.8 billion-$2 billion, the Economic Times daily reported on Thursday. If it results in success, it will further power its portfolio, brand equity, and global reach.

The deal, if fructifies, will enable Siddhartha Lal-led company expand globally and get access to technology, the ET report said. Meanwhile, let us know your views about Eicher Motors bidding for Ducati through the comments section below. The deadline is scheduled to the end of September and Eicher is making sure of finalizing the structure with the consulting banks. The deadline for Ducati's auction is said to be this month's end. The mentioned valuation is approx 15 times higher than its EBITDA (Earnings before interest, taxes, depreciation and amortisation) of €100 Million (₹760 Crores).

On Tuesday, a Reuters report said that Volkswagen has put the 1.5 billion-euro ($1.8 billion) sale of Ducati motorcycles on hold after resistance from German trade unions and internal rifts on strategy.

Now that we know the Bajaj's mystery collaboration is Triumph motorcycles and there are no reports of Harley-Davidson extending an offer, Eicher may have a clear shot if VW is willing to let go of ownership of one of the oldest and most iconic motorcycle brands in the world.

The company sold total 55,721 units in August 2016. The leaders feel that Ducati's business is in alignment to the global appeal of VW group and selling the same will not be a wise decision for the group in a long run. Now Eicher wants to own Ducati and hope for its success. Since acquiring Royal Enfield, Eicher Motors has turned its fortunes and made it a globally profitable brand.

Royal Enfield to bid almost $2bn for Ducati India