Italian motorcycle manufacturer MV Agusta is in financial trouble yet again, and this time, reports suggest that MV Agusta may be considering filing the equivalent of Chapter 11 bankruptcy.
The company has announced that it hopes to restructure its 40 million Euro debt with its lenders, and this despite posting a turnover of 100 million Euros in 2015, an increase of 30 per cent over the previous year.
MV Agusta's relationship with Mercedes-AMG is also not going great, according to reports. There has been no announcement from Mercedes-AMG so far, the owner of 25 per cent of MV Agusta. Mercedes bought the 25 per cent stake in MV Agusta at the end of 2014, but MV Agusta has piled on debt since then to expand the company rapidly .
"With the active involvement of all its employees and a reinforced management structure, MV Agusta has already identified the strategy aimed at consolidating and strengthening corporate values, as well as the protection of the company's stakeholders. We are confident that - overcoming the current situation of financial liquidity - our company will recover and achieve economic results that satisfy the expectations of our employees and our creditors," a press statement from the company said.
(MV Agusta Brutale 1090)
There are also rumours floating around of Mercedes planning to buy out MV Agusta in full - in order to save their original 25 per cent investment. The Italian brand has changed hands four times in the past 12 years, beginning from Harley-Davidson and now Mercedes-AMG. Another roadblock could be current CEO Giovanni Castiglinio's reluctance to relinquish control of the company, let alone sell.
MV Agusta has a strong brand name in motorcycling, owing to its racing heritage and exotic Italian lineage. The firm Agusta has survived worse situations in the past, ever since the firm was revived by Claudio Castiglioni nearly 20 years ago. Claudio's son Giovanni is now looking for financial partners, but it's easier said than done, without relinquishing control.
In India, MV Agusta has only started operations recently, selling its much celebrated motorcycles, including the Brutale series, through a tie-up with Kinetic. We sure hope the company's finances are sorted out soon.
