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Old 17th July 2007, 13:12   #1
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Question Bajaj to aquire Ducati???

There was a news report in Economic Times yesterday, saying Bajaj is contemplating an aquisition in Europe, Ducati or Triumph being the possible targets . I found it hard to believe. But how I wish this to come true!! Any inside information guys??
I couldn't get the online source for this article, but I have this link which quotes the News Item.

Source: Life on wheels: Bajaj Ducati or Bajaj Triumph. Which one?

Here's the economic times report link: http://economictimes.indiatimes.com/...ow/2206133.cms

Last edited by aah78 : 18th July 2007 at 21:49. Reason: posts merged, link edited
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Old 17th July 2007, 14:21   #2
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If this is true then I do not want to buy a Ducati DTSi. Sad news I say.
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Old 17th July 2007, 14:22   #3
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The news was in the local papers here in DXB too - Indian two-wheeler giant eyeing Ducati, Triumph it said.
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Old 17th July 2007, 14:24   #4
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Ducati is too big for bajaj to grab. Triumph will be more like it, if it's true.
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Old 17th July 2007, 14:27   #5
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Bajaj is seating on a cash pile and they need a profitable avenue to channelize this. Now the way things are going they realize that they need to look beyond the Indian market and even in the Indian market it has to be the premium bikes. Those economisers do not do any favor to their bottomline.

One way of doing this is by means of ever increasing R&D spends. In fact Bajaj has been one of those rare Indian companies that even tasted success this way. However this is a cost-intensive way of moving up the value chain and also takes good amount of time. The upside of course is that a single big hit takes care of years of spends as the margins are huge (no royalty, no/negligible import content, no external dependencies etc).

Obviously Bajaj is now looking at something more than this. They want to grow inorganic. One big bang and there you are. Catapulted to the top of the heap. They probably reckon (maybe correctly as well) that a Ducati name in their arsenal will do just that. If you can sell a bike abroad for close to 10lac rupees and can make it for say just 7lacs (expect Bajaj to manage huge cost savings by various means including outsourcing parts of the manufacturing process to India) it is biiiiiiiggg profit.

Way to go bajaj. Lets swing it. Mittals, Tatas, Birlas... I guess now its the Bajajs' turn to give the world its next shock.
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Old 17th July 2007, 14:28   #6
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Quote:
Originally Posted by devarshi84 View Post
Ducati is too big for bajaj to grab.
Why so?

Bajaj has the money. The largest stakeholder in Ducati is a venture capital firm that hold 33.5 percent and very clearly wants to SELL it after having picked up the stake when the Italian company was tottering.

Have money, will buy. There's nothing considered 'too big' these days - the bigness is the NAME. In most cases fancy names hide some really bad financials. Ducati is still struggling - its a one-model company, in that it survives on one big model and not a range of great bikes.

At the end of the day the name means nothing if it cannot create a sustainable growth model. Ducati doesnt have one.

Last edited by Steeroid : 17th July 2007 at 14:30.
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Old 17th July 2007, 14:35   #7
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Originally Posted by moralfibre View Post
If this is true then I do not want to buy a Ducati DTSi. Sad news I say.
Sad news, is it? And pray why so? Does not it reek of a complex? I think you should also be sad about the european automobiles now. The venerable Arcelor that used to supply the steel earlier has now been taken over. These mighty cars are now made by some filthy Mittal-Arcelor steel.

As a matter of fact Bajaj holds the worlwide patent for the DTSI technology in bikes. No one managed to do that with such small engines. If anything you should be happy that those who bow at the altar of the pro-biking gods will now know how the Indians measure up. I think it is something to be proud of. Particularly if Ducati increases its profit by a few folds on a Bajaj takeover. And it is possible... very much so.
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Old 17th July 2007, 14:42   #8
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Quote:
Originally Posted by Zappo View Post
Sad news, is it? And pray why so? Does not it reek of a complex? I think you should also be sad about the european automobiles now. The venerable Arcelor that used to supply the steel earlier has now been taken over. These mighty cars are now made by some filthy Mittal-Arcelor steel.

As a matter of fact Bajaj holds the worlwide patent for the DTSI technology in bikes. No one managed to do that with such small engines. If anything you should be happy that those who bow at the altar of the pro-biking gods will now know how the Indians measure up. I think it is something to be proud of. Particularly if Ducati increases its profit by a few folds on a Bajaj takeover. And it is possible... very much so.
Zappo you took my comment seriously. I guess I should have added a smiley to make it sound the way I wanted to. I am proud about the fact that an Indian company is taking over a European brand marquee and I am sure Bajaj wont implement DTSi or whatever in those bikes let alone market them as DTSi's. Relax. I am happy and hope that Bajaj ensure that they dont degrade the Duke's with broken fork pipes et al

And hey, what reek of a complex? I am not European yet , are you?

Last edited by moralfibre : 17th July 2007 at 14:43.
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Old 17th July 2007, 14:58   #9
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Truimph? No no...

Ducati? Oh yeah! Cant wait for a Ducati Bajaj Desmosedici DTSi.
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Old 17th July 2007, 15:43   #10
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Ducati isn't too big for Bajaj. According to the report it is valued at somewhere around 95million Euros, which translates to around 500 Crores. This is not at all a big deal, going by recent aquistions by Indian companies.

By the way, wat would be the cost of a Ducati, now costing around 10L, if produced in India by Bajaj post aquistion Perhaps I am dreaming too much too early may be, but who cares
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Old 17th July 2007, 16:04   #11
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BTW Ducatis are the first to launch twin plugs way back in 70's but they dropped as didnt found much helpful to develop more power.
I really doubt that its going to happen.
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Old 17th July 2007, 16:22   #12
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Talking The favour returned?

Rahul's son (forgot his name) once met the owner of Ducati and expressed his fascination for the bike and the owner told him - you should try one, i will send you one. Sure enough, the bike got shipped to him without his knowledge and was lying in the customs for a few months, till he spoke to the owner again who asked him how was the bike? Rahul's son then got back to India, cleared the bike through customs and finally got it. I guess he must have loved the bike enough and in gratitude, is now buying the company!
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Old 17th July 2007, 16:44   #13
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Quote:
Originally Posted by rangaraj View Post
Rahul's son (forgot his name) once met the owner of Ducati and expressed his fascination for the bike and the owner told him - you should try one, i will send you one. Sure enough, the bike got shipped to him without his knowledge and was lying in the customs for a few months, till he spoke to the owner again who asked him how was the bike? Rahul's son then got back to India, cleared the bike through customs and finally got it. I guess he must have loved the bike enough and in gratitude, is now buying the company!
Sounds like a fairytale (tthakumar jhuli... never mind) that my grandmother used to spin for me in my childhood. Do you really have any basis for this story? Sounds incredibly naive to me.
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Old 17th July 2007, 17:01   #14
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Quote:
Originally Posted by Steeroid View Post
Why so?

Bajaj has the money. The largest stakeholder in Ducati is a venture capital firm that hold 33.5 percent and very clearly wants to SELL it after having picked up the stake when the Italian company was tottering.

Have money, will buy. There's nothing considered 'too big' these days - the bigness is the NAME. In most cases fancy names hide some really bad financials. Ducati is still struggling - its a one-model company, in that it survives on one big model and not a range of great bikes.

At the end of the day the name means nothing if it cannot create a sustainable growth model. Ducati doesnt have one.
I will be as proud as you if not more if Bajaj takes on Ducati's reigns. But there are some harsh facts facing the European bike makers.

European Motorcycle firms are usually expensive to maintain and slow to give returns. Majority of the makes have been sold time and again and closed and reopened after heavy cash inflows.

1. MV Agusta (was sold off for 1 Euro by proton)
2. benelli (The Chinese firm has taken too long to return to profits)
3. Aprilia (after some heavy losses due to acquisitions is now part of piaggio)
4. Bimota (submerged with the v-due's and has since remained niche maker)
5. Moto Guzzi (first owned by Aprilia and then Piaggio)
6. KTM (turned insolvent and had to be helped by Polaris)
7. Laverda (was taken over by Aprilia and then by Piaggio)

Their hisotry are just some expamples. Triumph is still a much smaller scale company and its losses can be absorbed.

I dont know the indepth history of these marques but I do know that for Bajaj it will be a too risky buy.


as far as losses are concerned, they too have to be borne by Bajaj. Siemens mobile was in Losses. Siemens paid benq to buy their handset unit. Benq-Siemens was formed. The whole venture went under and the last news were that Benq Sold its headoffices to keep in Business.
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Old 17th July 2007, 17:06   #15
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Quote:
Originally Posted by rangaraj View Post
Rahul's son (forgot his name) once met the owner of Ducati and expressed his fascination for the bike and the owner told him - you should try one, i will send you one. Sure enough, the bike got shipped to him without his knowledge and was lying in the customs for a few months, till he spoke to the owner again who asked him how was the bike? Rahul's son then got back to India, cleared the bike through customs and finally got it. I guess he must have loved the bike enough and in gratitude, is now buying the company!

I remember watching some interview where something like this was mentioned ..dont remember who .Guess it could have been Bajaj.
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