Bajaj Auto Invests €800 Million in KTM Revival with Plans to Lead the Brand
Bajaj Auto International Holdings BV is set to obtain a loan of up to 566 million Euros, or Rs. 5,431 crore, for KTM AG’s insolvency proceedings
Bajaj Auto Invests €800 Million in KTM Revival with Plans to Lead the Brand
A subsidiary of Bajaj Auto International Holdings BV (BAIHBV) initiated discussions and looked into possibilities to join the restructuring efforts of KTM AG according to a Monday exchange filing while media claimed it secured financing to rescue the Austrian company from bankruptcy.
The action intends to assist KTM's current restructuring process while safeguarding its operational activities during financial challenges.
In support of the plan BAIHBV has provided KTM AG a 450 million euros secured term loan while subscribing to 150 million euros convertible bonds from Pierer Bajaj AG which totals their financial commitment to 600 million euros. The total funding of about 800 million euros comprises an initial shareholder debt injection of 200 million euros (equivalent to Rs 7,765 crore).
The transactions aim to satisfy the Austrian court-mandated deadline on 23 May 2025 which requires settling 30% of creditor claims as part of the approved KTMs restructuring plan.
Bajaj Auto intends to obtain controlling NIFTY 50 in PBAG, Pierer Mobility AG's parent company which controls KTM AG after receiving regulatory consent from Austria. Through PBAG and Pierer Mobility, Bajaj indirectly owns 37.5% of KTM.
The company board has chosen to obtain retrospective shareholder consent for related-party transactions through postal ballot as required by SEBI regulations.
Through this development Bajaj Finance moves from its position as a minority investor to become the primary strategic owner of KTM to oversee governance restructuring and operational recovery while examining opportunities within their existing joint development initiative in India.
Once approval is secured Bajaj Group will implement a turnaround strategy targeting operational revival and financial stability while expanding KTM's global brand presence.
The share price for Bajaj Auto on the BSE fell by 1.62% to reach Rs 8551.15. The Investment Holding Companies (NEC) demonstrates Bajaj Auto's commitment to protecting its investment while backing its European affiliate through its challenging financial restructuring phase.
