EXUP Worldwide

Maybe this will be the first time in history where the company that was bought out will replace all the engineers of the parent company

The thing that got me is that MV sold an entire 330 bikes last year in the US. Granted, I've never seen one on the road around here, but didn't think they were that rare in the US.

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Harley-Davidson to buy Italian bike maker MV Agusta for $109M, increase European presence
July 11, 2008: 04:29 PM EST

NEW YORK (Associated Press) - Harley-Davidson Inc. said Friday it will buy Italian motorcycle maker MV Agusta Group for about $109 million to boost its presence in Europe, giving it entry into the popular performance bike market there.

MV Agusta makes a line of premium sport motorcycles under its name brand and a line of lightweight motorcycles under the Cagiva brand.

The deal will help Harley-Davidson expand into the European market as sales slump in the U.S., where consumers are pulling back on spending. Performance, or sport, bikes account for about 80 percent of sales in Europe, Harley-Davidson Chief Executive Jim Ziemer said. Harley-Davidson's sales there have been growing in the double digits for the past three years, and the company now has nearly 10 percent of that market.

The MV Agusta aquisition gives Harley-Davidson a chance to go after European sport motorcycle riders, who tend to be younger than U.S. motorcycle riders, Ziemer said.

Sport motorcycles are typically high performance and require riders to lean forward. Heavy weight motorcycles like Harley-Davidson's top-selling touring bikes are heavier and allow for a more laid-back riding style since drivers can sit upright.

The heavier-weight bikes are more popular in the U.S., but worldwide, sport motorcycles account for half of all sales. It's a big market for Harley-Davidson to enter.

"This gives us a better way to get into that and understand that customer base at a different level than we're currently playing at," Ziemer said.

Shares of Harley-Davidson fell 37 cents, or 1.1 percent, to close at $33.33 on Friday. The stock set a new 52-week low of $32.33 earlier in the day. It has traded as high as $62.99 in the past 52 weeks.

The deal is expected to close in several weeks. It will paid for through euro-denominated debt, Harley-Davidson said.

The purchase price includes Harley-Davidson assuming MV Agusta's existing bank debt of about $70 million.

MV Agusta is privately held, and the Castiglioni family owns 95 percent of its shares. Under the agreement, Harley-Davidson will pay Claudio Castiglioni, who will continue to serve as chairman, additional payments in 2016 if certain financial targets are met.

MV Agusta will keep operating from its headquarters in Varese, Italy.

Harley-Davidson will appoint a new managing director once the deal closes.

MV Agusta is considerably smaller than Harley-Davidson, which has nearly half the U.S. market. The company has about 500 dealers worldwide, the majority of them in Europe, and in 2007 it shipped 5,819 bikes. Harley-Davidson shipped 330,619 bikes last year and has a network of about 1,300 dealers.

In the U.S., MV Agusta has about 45 dealers that sold 330 bikes last year.

Harley-Davidson noted MV Agusta significantly slowed production this year due to financial difficulties.

MV Agusta's bikes are considered premium, high-end bikes and typically sell in a range of about $14,495 to $24,995 in the U.S. Some sell for even more, with special editions fetching $120,000. In the upcoming Batman movie "The Dark Knight", Bruce Wayne _ Batman's alter ego _ will ride a new MV Agusta F4 superbike.

Harley-Davidson's bikes range from $6,695 to $34,995, with the average about $15,000.

UBS analyst Robin Farley said in a research note that the purchase could be considered an investment since MV Agusta may be operating at a loss and might not make money for several years.

Craig Kennison, an analyst with Robert W. Baird, wrote in a note that the deal gives Harley-Davidson room to expand into the large sport bike market. He estimated those bikes accounted for one-third of the U.S. market.

"The deal is promising in that it gives Harley a premium sport bike brand, expands its manufacturing footprint, and highlights its under appreciated opportunity in Europe," he wrote.

Harley-Davidson is due to announce its second quarter earnings next Thursday. The company recently announced a plan to cut 8 percent of its work force and trim bike shipments by the thousands as domestic sales fall.

That's funny...I know five people that have one.
I think it's a good thing both for Harley and for MV

dragracer1951 wrote:I think it's a good thing both for Harley and for MV

As long as they don't let anybody from Buell get near MV it should benefit both companies.

I don't really hate HD...it's just that their bikes are so overpriced there's no way I'd spend that kind of cash when I could walk away with two new Yamaha's for the price of a Harley. That and the idiot mentality that seems to be come with owning a Harley.

I don't know. I own five of them. But the newest is a 74. I think hte oldest is a 40.
But I know what you mean about attitude. I stopped riding them when their shops became butt jewlery boutiques....
The quality of HD has REALLY gotten better.
Look at the base models japanese and HD. They are not that far apart. Adn the HD has much better resale value.
Hell...My 74 FXE is worth about $8k as it sits.

I admit it, I like to knock Harley's as a recreational pastime. But the standard Harley rider around here is a good part of the biker community. Most of them ride Harley's because it's a big enough bike for them to fit on. 6'6" and 250+ lbs does not fit well on a sportbike unless it's a Hayabusa - if they can take the riding position. Or they like to ride 2-up or just cruise the countryside (in a group they make a nice rolling slalom course). The posers and Trailer Queens can be a real pain in the a$$. The custom chopper crowd is worse. But there are a few sportbike squids that fit right in with the "who's got the bad attitude now" crowd (like the other day when the sportbike squid, stopped at the intersection, decides to smoke his rear tire while he waits for the light to turn green ... I was hoping his engine would blow). Harley's are not for me, I'm a sportbike rider. But there would be a lot fewer average people riding bikes, at least in the U.S., if they didn't have Harley's or metric cruisers to ride.

Harley = 2 wheeled couch. I don't ride couches. I see no need or even a good reason to ride on a machine that performs so poorly in every facet as does a Harley. I really get a kick out of the fact that my $7,K SV650 (70HP) has nearly as much HP as a Stage 2 1340 Evo Hardley (74HP) ! Of course it takes all the torque a big twin can muster to move the grossly overweight sleds down the avenue as they take their rapidly aging wannabe-bikers on their lumbering and frequently dangerous tours of such wonderful scenics as the Smokies.

well if they are sacking the mv engineers, there goes the quality workmanship of the MV.

hopefully the added cash from HD will be put to good use by the mv people.

The attitude of HD riders is a bit over the top, you think they were the only bikers that mattered, esp over in the USA. They are a bit big to be drive around out roads here in the they UK kinda like tractors causing long tailbacks lol.

Ebolavictim wrote:well if they are sacking the mv engineers, there goes the quality workmanship of the MV.

IMO I don't think Harley will dare mess with any of the top staff at MV. They want to make their presence larger in Europe and starting out by getting rid of their engineers and turning the bikes into piles of crap isn't a good way to go about doing it. Yes, HD has improved their engineering, but look at Buell - their quality record isn't the best.

causing long tailbacks lol.

It always kills me how I never pass anybody on a sport bike....and never get passed by a Harley rider. I know they aren't designed for speed, but sheesh, when your backing up 93 year old little ol' ladies whose heads stick up about an inch above the dashboard of their Buick it's a sad day.

orionburn wrote: .... but sheesh, when your backing up 93 year old little ol' ladies whose heads stick up about an inch above the dashboard of their Buick it's a sad day.

I was passed by that lady. No stuff ! Here I am riding on the FZR doing around 90mph and this little ol' lady in a Buick goes inching by me on the right !

No doubt about it ... it takes a special kind of stupidity to ride an HD. I'm passed ALL the time in an 18 wheeler, where they pass ya, pull in tight and then slow down. I'm on cruise control anT the govenors limit of 65 mph, so I don't like to slow up. I can't pass them again because traffic is at 70-75, so I burn my brights at them and creep up to them ... and ALWAYS get the same dirty looks, like WHAT'S wrong with ME???

There is one arround here but i seen it only a few time.
Pretty good looking bike!!!!!!!

when i was living outside philly, mv's were somewhat common. back here in ohio, not one in sight.

the only good that can come from harley buying mv is the cash. if they step in and try to create harley sportbikes, the marque is better off dead.

Hooligan wrote:if they step in and try to create harley sportbikes, the marque is better off dead.

And we all remember what a great start Buell had when they first launched....

Great now there will be a motorcycle that leaks olive-oil!!!!!!!!!!

Yeah, but it won't be virgin....

LOL..... Ya virgins are good for nothing!!!!!!!!