After Saab bid, Mahindra & Mahindra to look at Ducati?

Will Mahindra & Mahindra (M&M) add Ducati, the marquee Italian maker of fabulous sports bikes, to its kitty?

The buzz stems from a report in the Financial Times of the UK, which said the private-equity firm that owns Ducati is looking to sell the brand for a billion pounds, or three times the initial investment.

Investinindustrial, the private equity group, said it will be looking for a partner this year. “Ducati is now a perfect company, but for further growth it requires the support of a world-class industrial partner,” Andrea Bonomi, Investindustrial’s chairman, told the paper.

The report mentions M&M among possible buyers, along with German manufacturers BMW and Volkswagen.

An M&M spokesperson refused to comment, saying, “We do not comment on speculation.”

Auto industry sources said with M&M intending to be a global player — it is already moving towards a bid for  Saab, the Swedish car and truck maker — looking at a brand like Ducati is a logical approach.

Ducati sells 40,000 bikes globally a year and has a market share of about 9% in the global sports bike segment.

A foreign buyout is not exactly unknown territory for India’s third-largest automaker by market capitalisation. M&M last year acquired and is successfully integrating South Korean sports utility vehicle manufacturer Ssangyong. It is also said to have signed a confidentiality agreement with Saab and is expected to finalise a bid very soon.

“M&M is looking to become a full-range manufacturer at the global level. Ducati is a very niche and iconic product. In the case of Ssangyong, it understood the market… M&M has always been a strong player in utility vehicles. But with Saab and Ducati… there is no demonstrated success in passenger cars and motorbikes,” said Mohit Arora, executive director at JD Power.

But the move can benefit Mahindra 2 Wheelers, a subsidiary.
According to the Society of Indian Automobile Manufacturers data, M&M sold 113,413 vehicles this fiscal — down 14.78% from the same period last year.

The company currently sells Rodeo, Flyte and Duro gearless scooters. It will also relaunch Stallio, which was withdrawn last year.