Porsche to Divest Stake in Luxury Sports Car Manufacturer Bugatti

Porsche Ditches Stakes in Bugatti, Rimac Amid Core Brand Revamp

Porsche has agreed to sell its stakes in sports car makers Bugatti and Rimac to a consortium led by HOF Capital, a U.S.-based fund linked to Egypt's billionaire Sawiris family. The move comes as Porsche reviews its strategy after its operating profit slumped 93% last year, deepening a crisis at the German brand, which is majority-owned by Volkswagen.

Under the deal, Porsche will divest its 45% stake in Bugatti Rimac, a joint venture set up in 2021 that owns France-based Bugatti and a 20.6% stake in Croatia's Rimac. The consortium, led by HOF Capital, includes BlueFive Capital, a fund with $15 billion in assets under management. Financial terms were not disclosed, but a person with knowledge of the matter said Bugatti Rimac had a valuation of over $1 billion.

Porsche's new CEO, Leiters, is focusing on reviving the company's struggling core brand. The sale of Porsche's stake in Bugatti Rimac is part of a broader effort to cut costs and free up capital. Since the joint venture was formed, Porsche has become a drag on parent Volkswagen, with profit margins crashing to 1.1% last year from 14.1% in 2024, squeezed by U.S. tariffs and weakening demand in China.

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The deal marks a significant shift in Porsche's strategy, which had been focused on expanding its presence in the luxury sports car market through its joint venture with Rimac. However, the partnership has not yielded the expected returns, and Porsche is now looking to concentrate on its core business.

Rimac Group is set to take control of Bugatti Rimac once the deal closes and will form a strategic partnership with BlueFive Capital and HOF Capital to support its growth. The partnership is expected to provide Rimac with the necessary resources to continue its development and expansion plans.