Porsche exits sports car maker Bugatti Rimac

Logo of the Porsche car manufacturer during the annual shareholders meeting of the Volkswagen stock company in Hannover, Germany, May 10, 2017. Volkswagen has set the price range for the multibillion-euro sale of a minority stake in luxury brand Porsche as its prepares an initial public offering to fund VW's investments in new technologies and businesses including electric cars, software and services. (AP Photo/Michael Sohn)

BERLIN - German carmaker Porsche announced on Friday the sale of its stakes in sports car manufacturer Bugatti Rimac to a consortium led by a U.S. fund founded by the Egyptian billionaire Sawiris family.

The amount of the transaction, which still has to be approved by regulators, has not been disclosed.

The announcement comes after the German luxury car brand warned it would face a difficult year under pressure from competitors and U.S. tariffs imposed by President Donald Trump.

Under the terms of the agreement, Porsche will sell all of its 45 per cent stake in Bugatti Rimac, a joint venture founded in 2021 with Croatian “supercar” manufacturer Rimac, which holds the remaining 55 per cent.

“Following completion, Rimac Group is set to take control of Bugatti Rimac and form a strategic partnership with HOF Capital and BlueFive Capital to support its continued growth,” according to a statement from the German carmaker.

Porsche, which is part of the Volkswagen Group, will also sell its 20.6 per cent stake in Rimac Group.

Last month, Porsche chief Michael Leiters said the company was facing “tricky times” after sales fell below expectations.

Porsche has struggled with years of falling sales in China amid fierce competition from local rivals as well as U.S. tariffs.

Trump’s tariffs have hit the firm particularly badly since it has no plants in the United States.

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

“Now, with the sale of our stake, we demonstrate that we will focus Porsche on the core business.”

HOF Capital will additionally join Rimac Group as the major shareholder alongside Mate Rimac, founder of Rimac and CEO of Bugatti Rimac.

The consortium led by HOF Capital - founded by the Egyptian billionaire Sawiris family - has BlueFive Capital as its main investor, along with a group of institutional investors from the United States and the European Union.

After regulatory clearances, the deal is expected to be finalized before the end of the year.