Hero MotoCorp, the Indian motorcycle and scooter manufacturer is in talks with several banks on raising funds for a potential acquisition of the Italian motorcycle maker Ducati Holding SpA.
‘Lots of bankers have been coming to us over Ducati,’ Pawan Kant Munjal, the managing director of Hero MotoCorp, yesterday said in an interview in New Delhi.
The strategies follow the exit early last year of Honda Motor Co. from an joint venture that prevented Hero MotoCorp, formerly known as Hero Honda Motors Ltd., from aggressively tapping overseas markets.
Private equity firm Investindustrial Holdings SpA, is looking to sell Ducati, and expects €1 billion ($1.32 billion) or three times its initial investment, the Financial Times had this month reported.
“It is an excellent fit — Ducati is a big brand and has a lot of technology; Hero is looking to be a serious global player,” said Deepesh Rathore, managing director of IHS Automotive in India.
The report comes shortly after Hero entered into a partnership with Erik Buell Racing, where Hero would sponsor two EBR teams in the AMA Pro Racing National Guard Superbike Championship in return for technology and design support for future models.
Hero MotoCorp shares have outperformed the market with most analysts putting a ‘buy’ recommendation on the company due to strong growth in monthly motorcycle sales.