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Rimac inks deal to purchase 55% of Bugatti from VW Group

ZAGREB, Croatia — Croatian electric supercar builder Rimac is taking over the iconic French manufacturer Bugatti in a deal that is reported to be worth millions of euros.

Rimac said Germany’s Volkswagen Group, including the Porsche division — which owns a majority stake in Bugatti — plans to create a new joint venture. The new company will be called Bugatti-Rimac.

Rimac Automobili announced Monday that it will be combining forces with Bugatti to “create a new automotive and technological powerhouse.”

Rimac has progressed in 10 years from a one-man garage startup to a successful company that produces electric supercars. Mate Rimac, who founded the company in 2009, says the venture is an “exciting moment” and calls the combination of the companies “a perfect match for each other.”

Porsche will own 45% of Bugatti-Rimac while Rimac Automobili will hold the remaining 55% stake, according to Croatian media reports. Financial details of the deal were not published.

Bugattis will continue to be assembled in eastern France, where the company was established in 1909. The vehicles will use engines developed and made in Croatia.

“In an industry evolving at ever-increasing speed, flexibility, innovation and sustainability remain at the very core of Rimac’s operations,” the company said. “Uniting Rimac’s technical expertise and lean operations with Bugatti’s 110-year heritage of design and engineering prowess represents a fusion of leading automotive minds.”

Aston Martin sues dealer over $3.5 million Valkyrie supercar

Aston Martin Lagonda Global Holdings said it’s suing a company affiliated with one of its dealers in Switzerland, alleging that it withheld customer deposits collected for the $3.5 million Valkyrie supercar.

The automaker accused Nebula Project AG of failing to pass some deposits taken from customers along to Aston Martin and said it has terminated an unconventional commercial arrangement its previous management team entered in 2016. Under the now-dissolved deal, Nebula had agreed to fund development of the Valkyrie and other mid-engine cars in exchange for royalty payments.

As a result of terminating the agreement with Nebula, Aston Martin is no longer liable for any potential royalty payments, which could have been “significant” over time, the carmaker said in a statement Tuesday. The company also cut off its dealer arrangements with AF Cars AG, the company that operates Aston Martin St. Gallen in Switzerland, whose board members manage Nebula.

A spokeswoman for the cantonal prosecutor’s office in St. Gallen said they are expecting a lawsuit to be filed but hadn’t received it as of noon Tuesday. A spokesman for Aston Martin St. Gallen was not immediately available to comment, according to a receptionist.

The canton of St. Gallen in eastern Switzerland is home to just 510,000 people but generates gross domestic product of almost 39 billion Swiss francs ($42 billion), making it a natural fit for wealthy fans of supercars. The Valkyrie, which Aston Martin expects to start shipping in the second half of the year, is intended to compete with mid-engine models made by the likes of Ferrari and McLaren.

While Aston Martin believes the net impact of its actions against Nebula will be positive over time, it’s expected to reduce cash flow and earnings before interest, taxes, depreciation and amortization by as much as 15 million pounds this year. The automaker’s shares traded down 1.9% as of 11:50 a.m. in London, paring an earlier decline of as much as 4.9%.

Valkyrie customers will still receive their cars as scheduled, Aston Martin said, despite the company not having received all the deposited funds. The company said it will take deposits for special vehicles directly from customers going forward instead of through dealers.

Aston Martin racked up significant losses after going public in 2018 and has spent the last year restructuring itself after a rescue by Canadian billionaire Lawrence Stroll, who took over as chairman. The 61-year-old fashion mogul has injected much-needed cash and forged closer ties with Daimler AG’s Mercedes-Benz to ensure the company survives tumultuous times for the auto industry.

Rimac reportedly planning stock IPO as it draws closer to Bugatti

FRANKFURT — Croatian electric hypercar maker Rimac is exploring several options for its future, a spokesperson for the group said in response to a report outlining plans for an initial public offering next year.

Germany’s Manager Magazin reported that Rimac, in which Volkswagen’s Porsche unit owns a 24% stake, was planning an IPO in 2022 at a valuation of 5 billion euros ($6.1 billion), without disclosing where it obtained the information.

“As for going public, we’re considering different options, but it hasn’t been decided which direction we’ll go in,” the Rimac spokesperson said.

Rimac has developed an electric supercar platform which it supplies to other carmakers, including Automobili Pininfarina.

It is currently working on a strategic partnership with Volkswagen unit Bugatti, which will likely result in a joint venture between Porsche and Rimac, with Porsche as a minority partner, Volkswagen CEO Herbert Diess said in March.

“The future of Bugatti is an issue that will be decided on a group level,” Porsche said in a statement, declining to comment further.

Porsche boss Oliver Blume earlier this year said intense discussions on Bugatti’s future were ongoing and that Rimac could play a role as the brands were a good technological fit, adding that a decision was expected in the first half of 2021.

Earlier this month, Rimac revealed the 1,914-horsepower Rimac Nevera.

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McLaren sells its Woking, England, headquarters for $236 million

McLaren has found a buyer for its headquarters in Woking, England. It sold the facility to a New York-based investment firm named Global Net Lease, but it’s not planning on moving to a new home anytime soon.

Hit hard by the ongoing coronavirus pandemic, the British firm put a “for sale” sign on its lawn in September 2020 with a major catch: The new owner would need to lease the facility back to McLaren in the foreseeable future. Canadian real estate firm Colliers listed the carmaker’s headquarters at £200 million (around $256 million at the time), and Global Net Lease announced it haggled the price down to £170 million, which represents about $236 million.

The deal includes the McLaren Technology Center, the McLaren Production Center (which manufactures road cars, like the GT), and the McLaren Thought Leadership Center. Parking lots and a small man-made lake are part of the transaction, too. Moving everything to a new location would be immensely expensive, not to mention time-consuming, so McLaren will lease the 840,000-acre site from Global Net Lease for the next 20 years. What happens after that isn’t known yet; McLaren will presumably either sign another multi-year lease or buy the site back.

This is the second time McLaren has received a nine-digit cash injection in less than a year. In June 2020, it arranged a £150 million round of financing from the National Bank of Bahrain. At the time, it said the funding would allow it to get through the coronavirus crisis while putting it in the best possible position to be competitive in the future. 

McLaren’s sale of its headquarters isn’t unprecedented in automotive history. In 2012, PSA Peugeot-Citroën (which is now part of Stellantis) sold its historic headquarters on Avenue de la Grande Armée in the heart of Paris for about $327 million to raise much-needed cash; it still leases the building in 2021. And, in January 2004, troubled British carmaker MG Rover sold most of its Longbridge, England, site to a property developer with plans to rent it. It signed a 35-year contract, and it optimistically added a renewal clause, but it shut down in April 2005 after years of losses.

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UPDATE: Porsche could raise its stake in Rimac, and Rimac weighs in

CLARIFICATION: An earlier version of this Reuters story said Porsche could raise its stake in Rimac to nearly 50%, but Rimac reached out to Autoblog to say that’s not so. Here is a statement from Mate Rimac:

“We have a very strong partnership with Porsche that is key for Rimac Automobili. Porsche is a shareholder in Rimac since 2018 with 15.5% ownership currently, accumulated over several rounds of investment. While it is true that we are discussing further expansion of this collaboration that will lead to increase of Porsche’s stake in Rimac Automobili, some media have mistakenly reported that Porsche would take over 50% or nearly 50% of the company.

We are very happy that the partnership with Porsche will strengthen even further, but it is in the interest of both Rimac and Porsche that Rimac is a fully independent company. We are working with many car companies that are not our shareholders and there is a clear separation between shareholding and projects. It is very important to us that our industry customers have the peace of mind that Rimac is independent and that there is an “Information Firewall” between projects and shareholders (not only Porsche, but also Hyundai and others) – and this will not change. Confidentiality is very valued in the industry and one of the basics for collaboration between companies. Our shareholders are happy with such an arrangement and expect the same level of professional behaviour and confidentiality for their projects and customer projects.

So, the point is: Porsche’s stake will increase but nowhere near to 50% and Rimac will remain independent with many industry customers that are not our shareholders/investors.”

The original story, with the 50% reference removed, appears below.

FRANKFURT — Volkswagen unit Porsche is participating in a financing round of Rimac Automobili that will see the electric supercar maker raise 130 million-150 million euros ($157 million-$181 million), its owner Mate Rimac told weekly Automobilwoche.

The fundraising should be completed in two to three months and another round is planned at the end of the year, Rimac told the trade journal.

Porsche owns a 15.5% stake in Rimac Automobili and could raise its stake in a deal that would also include the transfer of Volkswagen’s supercar brand Bugatti to Rimac, Automobilwoche said.

Volkswagen and Rimac were not immediately available for comment on Sunday.

Porsche Chief Executive Oliver Blume said earlier this month that intense discussions on Bugatti’s future were ongoing and that Rimac could play a role as the brands were a good technological fit, adding that a decision was expected in the first half of 2021.

Rimac has developed an electric supercar platform, which it supplies to other carmakers, including Automobili Pininfarina.

“Supercars have a limited market, the market for components is much bigger. That is why we are planning to expand our company,” Rimac told Automobilwoche.

That includes plans to more than double Rimac Automobili’s workforce by early 2023 to 2,500 from 1,000 currently, he said.

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