The Croatian electric car manufacturer Rimac will take over a majority stake in VW’s luxury Bugatti brand, as expected. The German automaker group is thus parting with a brand but will continue to hold shares in the new company Bugatti-Rimac via Porsche.
+ + Kindly see our update below + +
According to Porsche, a joint venture called Bugatti-Rimac is to be founded this year. The Rimac Group will hold 55 per cent of the shares in the joint venture, Porsche the remaining 45 per cent. However, the ownership situation is somewhat more complex, as Porsche also holds 24 per cent of the Rimac Group. In addition to CEO and founder Mate Rimac, other Rimac shareholders include Hyundai (12 per cent) and other investors.
Neither Porsche nor Rimac are disclosing the financial scope of the deal. The foundation of the new company is still subject to official approvals.
The Bugatti-Rimac joint venture, which will be based in Zagreb, will then own 100 per cent of both the Bugatti and Rimac Automobili brands. According to Porsche, together they will create an attractive automotive company that combines the “genes of the two strong brands Bugatti and Rimac”. The fact that Rimac holds a majority stake of 55 per cent is interpreted by some industry observers as meaning that nothing could restrict Mate Rimac’s creativity.
According to Porsche CEO Oliver Blume, the main aim is to combine Bugatti’s expertise in the hypercar business and Rimac’s innovative strength in e-mobility. “Bugatti is contributing a tradition-rich brand, iconic products, a loyal customer base and a global dealer organisation to the joint venture. In addition to technology, Rimac is providing new development and organisational approaches,” Blume said.
Mate Rimac sees the announced acquisition as a “really exciting moment”. “Together we will pool our knowledge, our technology and our assets with the goal of creating very special projects in the future,” says the Rimac CEO, who will also head the new joint venture. However, Rimac ruled out a quick switch from combustion engines to a pure EV brand for Bugatti, and the Bugatti site in Molsheim, France, is also to be retained alongside the headquarters in Zagreb. In Molsheim, 130 employees will work for Bugatti-Rimac, in Zagreb 300.
Bugatti is not to become an EV brand for now
“We bought the first shares in Rimac already three years ago and have successively increased them since then,” says Porsche CFO Lutz Meschke. “This enabled us to build a close relationship with Mate and its highly innovative team at an early stage. Now we are benefiting from this.” Meschke will join the Bugatti-Rimac supervisory board, as will Blume.
Volkswagen had taken over Bugatti in 1998 and revived the historic site in Molsheim. Since then, the brand has produced two models in numerous special editions, first the Veyron and later the Chiron. Both use an eight-litre W16 internal combustion engine. The Chiron will initially continue to be built. Jointly developed models are planned for the future, but they are to be very different from each other. A Bugatti-labelled version of the Rimac Nevera e-sports car is not planned.
The Croatian company Rimac Automobili was founded in 2009 by Mate Rimac aged only 21 after winning local, national and international competitions for electronics and innovation in his high-school years. Besides the hypercar company Rimac Automobili, Mate Rimac also founded Greyp Bikes, a high-tech e-bike and e-bike technology company. At Rimac Automobili, the sports car C-Two, long developed under the project name, is called Nevara in the production version and is built in Croatia. Rimac Automobili has also recently become an eMobility development service provider and is involved in many 800-volt projects of other carmakers worldwide. In March, Rimac had also opened a development office in the UK. The company also plans to move into a new corporate campus near Zagreb by 2023.
Update 3 November 2021:
About four months after the announcement, the Bugatti Rimac joint venture officially started operations on 1 November. The joint venture, based in Sveta Nedelja near Zagreb, is headed by Mate Rimac as CEO. As announced in July, the shareholders of the company are the Rimac Group (55 per cent) and Porsche AG (45 per cent).
The development, production and supply of battery systems, powertrains and other EV components, for which Rimac is known and also active for third parties, will be combined into a new unit – Rimac Technology. Rimac Technology is wholly owned by the Rimac Group and is therefore organisationally separate from Bugatti Rimac.
In the course of the takeover, Bugatti General Director Christophe Piochon will head the operational business of the joint venture as COO. As announced, Porsche CEO Oliver Blume and CFO Lutz Meschke will join the supervisory board of the new company.
Incidentally, at the conclusion of the takeover, Rimac published an updated chart of the ownership structure: according to the new chart, founder Mate Rimac holds the largest share with 35 per cent, while other investors hold 32 per cent. Porsche holds 22 per cent of the Rimac Group (instead of 24 per cent as stated above), Hyundai now 11 per cent instead of 12.
Update 18 January 2022:
Rimac has completed its restructuring. After the Bugatti Rimac joint venture officially started operations on 1 November (see above), the Rimac Group has been fully operational as an umbrella company since the beginning of this year, comprising both Bugatti Rimac and the new stand-alone entity Rimac Technology for the development, production and supply of battery systems, powertrains and other EV components.
Including reporting from Carrie Hampel
– ADVERTISEMENT –