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Harley-Davidson Inc HOG

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Harley-Davidson Attempts to Capitalize on Favorable EV and SPAC Trends With LiveWire Transaction

Jaime M. Katz, CFA Senior Equity Analyst

Analyst Note

| Jaime M. Katz, CFA |

Wide-moat Harley-Davidson announced that its LiveWire business will become its own publicly traded company in the first half of 2022 under the symbol LVW. The transaction is set to be funded by three stakeholders: Harley-Davidson, with a $100 million investment (74% ownership of the new company); Taiwanese powersports company Kymco, with a $100 million contribution (4%); and publicly traded special purpose acquisition company AEA-Bridges Impact Corp. (ABIC), with a $400 million addition (17%). The remaining ownership stake will be held by the founders of ABIC. In total, this transaction is set to net $545 million in cash to LiveWire, which is expected to help fast track market growth, global market leadership and brand recognition, and product launches (primarily slated to remain in the two-wheel category over the medium term).

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Company Profile

Business Description

Harley-Davidson is a global leading manufacturer of heavyweight motorcycles, merchandise, parts, and accessories. It sells custom, cruiser, and touring motorcycles and offers a complete line of Harley-Davidson motorcycle parts, accessories, riding gear, and apparel, as well as merchandise. Harley-Davidson Financial Services provides wholesale financing to dealers and retail financing and insurance brokerage services to customers. Harley has historically captured about half of all heavyweight domestic retail motorcycle registrations, a metric it has ceded in 2020 as it has repositioned the business. The firm recently expanded into the middleweight market with its Pan America model and into electric with the LiveWire brand.

Contact
3700 West Juneau Avenue
Milwaukee, WI, 53208
T +1 414 342-4680
Sector Consumer Cyclical
Industry Recreational Vehicles
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 4,600

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