Bajaj Auto acquires majority stake in KTM for ₹8,200cr
What's the story
Bajaj Auto has successfully acquired a majority stake in Austrian motorcycle manufacturer KTM AG. The move comes after the firm's €800 million (approximately ₹8,204 crore) deal received final approval from European regulators. The Indian bikemaker announced the development in a regulatory filing today, confirming that all formalities related to the transaction have been completed.
Name changes
Bajaj Auto International Holdings AG and Bajaj Mobility AG
As part of the deal, Bajaj Auto has announced a change in names for two companies. Pierer Bajaj AG (PBAG) will now be known as Bajaj Auto International Holdings AG. Meanwhile, KTM's holding company Pierer Mobility AG (PMAG), which is listed on Zurich and Vienna stock exchanges, will be renamed Bajaj Mobility AG.
Acquisition process
Bajaj Auto's journey to majority ownership
Bajaj Auto had announced its plan in May to transition from a minority investor to a majority stakeholder in KTM via its subsidiary, Bajaj Auto International Holdings BV (BAIHBV). The company secured eight out of nine regulatory clearances for the transaction. The European Commission gave the final nod on November 10, allowing Bajaj Auto to proceed with its acquisition plans.
Stake details
Bajaj Auto's stake in PBAG and PMAG
Before the acquisition, Bajaj Auto held a 49.9% stake in PBAG with Pierer Industrie AG holding the rest. PBAG owned almost 75% of PMAG, giving Bajaj an effective 37.5% indirect stake in KTM. After completing all conditions of the Call Option Agreement, BAIH has acquired all 50,100 shares of PBAG from PIAG on November 18, thereby acquiring a controlling stake in both PMAG and KTM through its wholly-owned subsidiary BAIH.