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Volkswagen purchases Ducati for $1.13 billion

Since 1926, Italian motorbike maker Ducati has built a reputation for crafting great looking motorcycle designs that pack the performance to win racing competitions. The manufacturer’s models have won 13 rider’s Superbike World Championships, but despite that distinction, sales of the company’s coveted models lag behind the industry leaders.

And while the company has been under the umbrella of the European investment group Investindustrial SpA for some time, reports indicate that Ducati has been sold.

On April 18, Reuters reported that Audi, a division of Europe’s largest automaker Volkswagen (VW), reached a deal to buy Ducati. While the terms of the sale were not formally disclosed as of the publication of that piece, sources told the news service that the price was around 860 million euros, or roughly $1.13 billion. Pending an approval by regulators, Ducati would become the 11th brand in VW’s portfolio alongside other luxury models such as Lamborghini and Bugatti.

News of the deal surfaced on April 17, when online news agencies began reporting that Audi was in talks to purchase Ducati Motor Holding SpA from its current owners for more than $1 billion, a price estimate that largely turned out to be accurate.

Still, while the move will expand the offerings of Volkswagon, some industry experts say they aren’t sure why the deal was made.

“I can’t think of a concrete reason for Audi to warrant a business case for buying Ducati,” Stefan Bratzel, an automotive director at the University of Applied Sciences in Germany, told the news source. “Ducati doesn’t enhance Audi’s business model in any way, it’s just a trophy in the wall cabinet.”

With the support of a larger company, however, the Ducati line may be able to compete with the leader in the cruiser, adventure and superbike categories, Honda. That company sold more than 16 million units in 2011, a far greater number than the roughly 40,000 Ducatis that were purchased by bike enthusiasts during that year.

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