Porsche to sell stake in sports car maker Bugatti
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FILE PHOTO: The Bugatti Chiron car made out of LEGO Technic blocks is pictured during the first press day of the Paris auto show, in Paris, France, October 2, 2018. REUTERS/Regis Duvignau/File Photo
DUBAI/FRANKFURT April 24 (Reuters) - Porsche will sell its stakes in sports car makers Bugatti and Rimac to a consortium led by a U.S. fund linked to Egypt's billionaire Sawiris family, the companies said on Friday, as Porsche's new CEO focuses on reviving its struggling core brand.
Under the deal, Porsche will divest its 45% stake in Bugatti Rimac - a joint venture set up in 2021 that owns France-based Bugatti and a 20.6% stake in Croatia's Rimac - to a consortium led by U.S.-based HOF Capital, the firms said.
The move comes as Porsche reviews its strategy after its operating profit slumped 93% last year, deepening a crisis at the German brand majority-owned by Volkswagen.
Financial terms were not disclosed, but a person with knowledge of the matter said Bugatti Rimac had a valuation of over $1 billion. Porsche and Bugatti Rimac declined to comment.
"In setting up the joint venture Bugatti Rimac together with Rimac Group, we successfully laid the foundation for Bugatti's future," Leiters said in the companies' joint statement.
"Now, with the sale of our stake, we are focusing Porsche on the core business."
PORSCHE UNDER PRESSURE TO CUT COSTS, FREE UP CAPITAL
When Porsche formed the joint venture with Rimac, then CEO Oliver Blume described it as combining Bugatti's hypercar expertise with Rimac's strength in electric mobility.
Since then, Porsche has become a drag on parent Volkswagen, with profit margins crashing to 1.1% last year from 14.1% in 2024, squeezed by U.S. tariffs and weakening demand in China.
Leiters, who took over as CEO at the beginning of the year, is now under pressure to cut costs and free up capital.
Rimac said in November it was in talks with Porsche over the joint venture's structure.
BlueFive Capital, which has $15 billion in assets under management, said on Friday it was among the investors in the consortium led by HOF Capital, a U.S.-based fund co-founded by Onsi Sawiris, but that it was investing only in Bugatti Rimac, not Rimac itself.
Launched in November 2024, BlueFive Capital is incorporated in Abu Dhabi's financial centre and has offices across the Gulf, as well as in London and Beijing, offering private equity, real estate, infrastructure and financial products.
Rimac Group is set to take control of Bugatti Rimac once the deal closes and will form a strategic partnership with BlueFive Capital and HOF Capital to support its growth, BlueFive Capital said.
($1 = 0.8560 euros)
(Reporting by Federico Maccioni in Dubai and Christoph Steitz in Frankfurt. Editing by Susan Fenton and Mark Potter)
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