Piaggio & Ducati merger synergies?

Italian Motorcycles SpA

A recent study by a world-renowned management-consulting firm, McKinsey & Company, suggests the possible synergies of a merger between Piaggio & C. S.p.a. and Ducati.

The study was revealed this morning by the Italian newspaper LaStampa.it. As Europe’s largest manufacturer of two-wheeled vehicles, Piaggio has already proven itself capable of acquiring other marquee brands. Their current brand line-up includes Aprilia, Moto Guzzi, Vespa, Gilera, Derbi and Scarabeo.

This news of the possible synergies comes shortly after Internet rumors of the imminent sale of Piaggio, as they are 55% controlled by IMMSI S.p.A. Company executives have stated that the sale and any plans for a merger are totally unfounded.

Piaggio closed 2009 with a 30.2% share in its home Italian market (up 1.7% percent over 2008), and has reported excellent performance in over 50cc scooters: 33.6% market share in 2009 (+2.1% higher than in 2008) with 5 product families in the top ten bestsellers.

Piaggio stock is also trading near a 52-week high of 2.3825, compared to the 52-week low of just 0.906, so it hard to tell if the group is in need of money.

The US-based Texas-Pacific Group acquired Ducati back in 1996 and took the company public. In 2005, after a very successful run, the company returned back to Italian ownership.

In 2008, Ducati was taken private, again in Italian hands. The new "private" Ducati is known as Performance Motorcycles SpA, so the exact financial condition of the company is unknown.

The other marquee Italian brand, MV Agusta, is looking for a permanent home after current owner Harley-Davidson announced last October that MV is up for sale. For the right money, Italian Motorcycles SpA could be in the works.