Harley-Davidson Discussing Purchase of Italian Rival Ducati From VW

Harley-Davidson is in talks to buy Ducati Motor Holding from Germany’s Volkswagen in a deal that could bring together two of the most storied motorcycle names and pave the way for further divestments by the German car maker.

The talks are still in very early stages and aren’t exclusive, three people familiar with the situation said. Audi , NSU -0.49% the luxury Volkswagen brand that owns Ducati, commissioned investment bank Evercore to begin floating a potential sale of the boutique motorcycle maker to investors in March, according to the people, and is seeking up to €1.5 billion ($1.68 billion).

Harley-Davidson, an iconic symbol of U.S. postwar culture, appears to be seriously considering a bid, these sources said. They said the company had engaged Goldman Sachs and visited Ducati’s plant and management in Bologna, Italy in early May.

A Harley-Davidson spokeswoman said the company never comments on market speculation.

Volkswagen declined to comment. Goldman Sachs didn’t immediately respond to requests for comment.

One of the most technically advanced motorcycle makers in the industry, Ducati is renowned for its prizewinning high-performance racing motorbikes. Harley-Davidson, whose bikes are known as “hogs”, faces an aging baby-boomer customer base and is eager to expand its business.

Ducati sold 55,451 motorcycles in 2016, an increase of 1.2% from the previous year. Audi doesn’t publish Ducati sales or earnings.

The Italian brand is a small part of the Volkswagen empire, but analysts say a sale could generate momentum for further streamlining, including the much-awaited public offering of the company’s truck business that includes the MAN and Scania brands.

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