Audi has sold a majority stake in a famous automotive design company Italian design To VATa Singapore-backed IT consulting firm with headquarters in California and India.
Terms of the deal, including price, were not disclosed, but Audi retains a minority stake in Italdesign. It will also be a “strategic partner” and an “important” customer of the Italian design firm in the long term.
The deal still requires regulatory approval, but UST says it will “help Italdesign expand its international presence through UST’s global presence in over 30 countries.”
Krishna Sudheendra, CEO of UST, said the company will “support Italdesign’s vision, honor its heritage, honor its heritage and bring in new skills that will help the team continue to grow,” although he did not provide details on how it will do this.
Although UST employs 33,000 people worldwide, including offices in Australia, it lacks the size and profile of other IT consultancies. Some of the biggest names like Accenture, Capgemini, Deloitte and Infosys employ at least ten times as many people.
UST was founded in 1999 and has grown steadily through acquisitions. In 2018, Singapore sovereign wealth fund Temasek acquired a 20 percent stake in UST for $250 million. Since then, Temasek has invested an additional $120 million in the company.
Although this appears to be UST’s first automotive acquisition, the company claims to have “worked side by side with the world’s best companies and leading automotive OEMs” since its inception.
Volkswagen bought 90 percent of Italdesign in 2010, with the remaining 10 percent remaining with Giorgetto Giugiaro and his family. In order to keep the Italian holdings together, Italdesign, together with Lamborghini, was transferred to Audi’s ownership.
Mr Giugiaro and his son sold their remaining shares in Volkswagen in 2015 and left the company to set up their own design consultancy.
There was speculation about Italdesign’s future within the Volkswagen Group, but nothing concrete happened until May this year, when employees were told that the company was for sale and that due diligence and valuation processes were underway.
Audi’s move to divest Italdesign is part of a broader push within the Volkswagen Group to cut costs and free up cash as sales decline across Europe and competition from Chinese automakers increases.
Italdesign was founded in 1968 by designer Giorgetto Giugiaro and engineer Aldo Mantovani. The company’s extensive credit list includes a number of legendary supercars, including the DMC DeLoren, the Lotus Esprit and the BMW M1 supercar.
It could be argued that Italdesign’s work was even more influential at the more affordable end of the spectrum, with the original Volkswagen Golf as well as the Fiat Panda, Punto and Uno all penned by the company.
Other credits include the first generation Daewoo Matiz, Hyundai Excel, Lancia Delta, Audi 80 and Lexus GS.
Under Volkswagen’s ownership, Italdesign continued to work with other car manufacturers, but the volume of products commissioned slowed significantly. Cars developed since 2010 include the Audi Q2, the limited edition Nissan GT-R50 and the Voyah Free for Chinese automaker Dongfeng.
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