India's Eicher Motors Ltd, the parent company of Royal Enfield, is closing in with a binding bid to buy Italian motorcycle manufacturer Ducati at an estimated cost ranging between $1.8 billion to $2 billion.
As per ET Auto, Eicher is currently finalizing and structuring its terms with global banks and consulting companies ahead of the end of the month bid deadline.
Various reports had earlier suggested that Hero MotoCorp and Bajaj Auto were queuing up to take over Ducati; however, it looks like it might not go through. Now Eicher is the latest Indian company to join the fray to buy Ducati. The Volkswagen Group has been on the lookout since April 2017 for a suitable company to purchase Ducati, which is owned by Volkswagen's subsidiary Audi.
There have been a few setbacks for the VW Group in selling Ducati. Volkswagen's German trade union had earlier opposed the sale process, arguing that Ducati has little synergy with the core operations of the VW Group and its sprawling global activities.
The VW Group will have a board meeting on September 29, 2017, to decide if Ducati will actually be on sale. It would only be after the meet, that VW would gauge whether Eicher Motors is a suitable buyer. If the buyout happens, it could propel Eicher Motors CEO Siddartha Lal's vision of expanding Royal Enfield's global footprint.
Ducati will bring a host of high-end technologies to the table if Eicher buys the Italian marque and could possibly help evolve Royal Enfield's motorcycles. Ducati also stands to benefit from utilising Royal Enfield's expertise in affordable production and increase its output.