Revving Up Revival: Bajaj Auto Injects €600 Million to Steer KTM Comeback

Unknown Apr 02, 2026 1,400 Views

Bajaj Auto Limited has made decisive financial and strategic moves to rescue Austrian motorcycle giant KTM AG, signaling a new era of control and partnership in the premium motorcycle market. Through its Netherlands-based subsidiary, Bajaj Auto International Holdings BV (BAIH), the Indian automak...

Key Highlights:

€150 Million Convertible Bonds Subscription: BAIH has subscribed to €150 million (in tranches, including a recent €50 million) of convertible bonds issued by Pierer Bajaj AG, the joint venture holding company that controls KTM’s parent, Pierer Mobility AG. These bonds are convertible into shares between June 2025 and February 2028, potentially increasing Bajaj’s influence in the group’s structure. The funding is aimed at meeting KTM’s urgent restructuring and working capital needs as the company recovers from bankruptcy.

€450 Million Loan Facility Executed: In a parallel move, BAIH has executed a facility agreement for a €450 million loan to KTM. This is part of a broader €566 million (approx. ₹5,431 crore) unsecured loan package arranged with JP Morgan Chase, DBS Bank, and Citigroup. The funds are earmarked for KTM’s insolvency plan, including a critical €548 million payment due to creditors by May 23, 2025, to avoid liquidation.

Strategic Control and Future Plans: Bajaj Auto, holding a 49.9% stake in Pierer Bajaj AG, is now positioned to play a decisive role in KTM’s restructuring and future direction. Managing Director Rajiv Bajaj has emphasized formulating a “sustainable solution” for KTM’s challenges, with Bajaj’s board actively considering further involvement and possible stake increases.

Market Impact: Bajaj Auto shares have responded positively to the news, reflecting investor confidence in the company’s bold strategy to secure and rebuild a major global motorcycle brand.

Background: KTM AG, known for brands like KTM, Husqvarna, and GasGas, filed for bankruptcy in November 2024 after accumulating heavy debt from acquisitions and racing investments, compounded by slumping European demand. Bajaj’s timely interventions have already enabled the phased resumption of production at KTM’s Austrian plant.

With these decisive moves, Bajaj Auto is not only safeguarding its investment but also taking charge of KTM’s revival, reinforcing its stature as a global motorcycle powerhouse and strategic industry leader.

Sources: NDTV Profit, Economic Times, Carandbike, CNBC TV18, Bloomberg, Outlook Business

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