Porsche, under pressure to cut costs, divests from iconic Italian sportscar maker Bugatti

DUBAI/FRANKFURT April 24 (Reuters) – Porsche has agreed to sell its stakes in sportscar makers Bugatti and Rimac to a consortium led by a U.S. fund co-founded by a scion of Egypt’s billionaire Sawiris family, one of the co-investors said in a statement on Friday.

Under the deal, Porsche will divest a 45% stake in Bugatti Rimac, the joint venture hosting the iconic Italian brand, as well as a 20.6% stake in Rimac Group, said BlueFive Capital, one of the acquiring investors. 

While the investment firm did not disclose the financial terms for the deal, Reuters reported in 2022 that Croatia’s Rimac had a valuation of over 2 billion euros ($2.34 billion).

“In setting up the joint venture Bugatti Rimac together with Rimac Group, we successfully laid the foundation for Bugatti’s future,” Porsche CEO Michael Leiters said in the 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

Porsche AG formed the joint venture with Rimac in 2021, with the German automaker’s then CEO Oliver Blume touting it as a marriage of Bugatti’s expertise in hypercars with Rimac’s innovative strength in the field of electric mobility.

Since then, however, Porsche has become a burden for parent Volkswagen, with profit margins crashing to a mere 1.1% last year, down from 14.1% in 2024, as the company was squeezed by U.S. tariffs and falling demand in China.

Now, Leiters, who took over as CEO at the beginning of the year, is under pressure to cut costs and free up capital. 

Rimac said in November that it was in talks with Porsche over the structure of the joint venture.

BlueFive Capital, which has $15 billion in assets under management, said on Friday it was one of the investors in the consortium led by HOF Capital, a U.S.-based fund co-founded by Onsi Sawiris. 

Launched in November 2024, BlueFive Capital has offices across the Gulf, in London and Beijing and offers private equity, real estate, infrastructure and financial products to private wealth, institutional and retail clients.

Rimac Group is set to take control of Bugatti Rimac and form a strategic partnership with BlueFive Capital and HOF Capital “to support its continued growth,” when the deal is completed, BlueFive Capital said in a statement.

($1 = 0.8560 euros)

(Reporting by Federico Maccioni in Dubai and Christoph Steitz in Frankfurt; Editing by Joe Bavier)