In a significant strategic move poised to reshape the global premium motorcycle landscape, Indian automotive giant Bajaj Auto has announced its intent to take majority control of Austrian motorcycle manufacturer KTM AG. This landmark acquisition, valued at €800 million (approximately ₹7,200 crore), will see Bajaj transition from a long-standing minority investor to the dominant stakeholder, providing a crucial financial lifeline to the debt-laden European brand.
The move comes as KTM AG and its subsidiaries, including KTM Components GmbH and KTM F&E GmbH, have been grappling with severe liquidity issues and had entered a court-supervised restructuring process in Austria in November 2024. A restructuring plan, approved by creditors in February 2025, mandated a one-time 30% cash payout of claims by May 23, 2025, to avoid full insolvency. Bajaj Auto’s intervention, through its Netherlands-based wholly-owned subsidiary Bajaj Auto International Holdings BV (BAIHBV), directly addresses this critical deadline and paves the way for KTM’s revival.
Of the €800 million debt funding package, €200 million has already been infused into KTM in tranches since FY2024 to ensure business continuity during the self-administration phase. The remaining €600 million is now being deployed to meet creditor obligations and inject fresh capital for operational restart. This comprehensive financial support includes a €450 million secured term loan to KTM AG and €150 million via convertible bonds in Pierer Bajaj AG (PBAG), which will then be loaned to Pierer Mobility AG (PMAG), KTM’s parent company. Bajaj has also reportedly assumed an €80 million loan initially taken by a Pierer group company, preventing a potential foreclosure that could have jeopardized the entire restructuring plan.
A Strategic Shift in Ownership and Governance
Currently, Bajaj Auto holds an indirect 37.5% stake in KTM’s listed parent, Pierer Mobility AG (PMAG), through a chain of investments involving Pierer Bajaj AG (PBAG). With this new development, Bajaj Auto aims to acquire sole controlling interest in PBAG. This will effectively grant Bajaj operational control over KTM’s global business, marking a profound shift from its previous role as a passive investor to an active leader.
Upon receiving the necessary regulatory approvals from the Austrian Takeover Commission, Foreign Investment Control, and Merger Control authorities, Bajaj Auto plans to reconstitute KTM’s board and governance structure. The company has articulated a clear vision for KTM’s turnaround, which includes:
- Restoring Momentum and Competitive Growth: A comprehensive program will be launched to stabilize the company and drive financial viability.
- Expanded Joint Product Development: The successful collaborative development program between India and Austria, which has already seen KTM bikes developed, manufactured, and exported from India to over 80 countries, will be further accelerated.
- Exploring New Partnerships: Bajaj aims to forge new collaborations to enhance technology leadership and foster long-term value creation.
Impact and Future Outlook
This decisive move by Bajaj Auto is expected to have a far-reaching impact on both companies and the wider premium motorcycle market. For KTM, it signifies a fresh start, a lifeline that averts insolvency, and the potential for renewed growth under a more direct and financially robust leadership. The immediate resumption of production and supply chain activities, which had been halted, will be a key positive outcome.
For Bajaj Auto, the acquisition underscores its ambition to become a global leader in the high-performance motorcycle segment. By taking full control of a revered brand like KTM, Bajaj strengthens its international footprint, elevates its brand presence, and gains deeper access to advanced motorcycle technology and expertise. This strategic maneuver positions Bajaj Auto at the forefront of shaping the future of high-performance motorcycling on a global scale.
While regulatory approvals are pending, the commitment of €800 million by Bajaj Auto signals a strong intent and a belief in KTM’s inherent brand strength and market potential. The motorcycle world will be watching closely as this new chapter in the Bajaj-KTM partnership unfolds.