Bajaj increases stake in KTM

India’s second largest motorcycle manufacturer, Pune based Bajaj Auto Ltd, increased its shareholding in Europe’s second largest motorcycle manufacturer, KTM Power Sports AG from 31.92 percent to 35.67 percent.

According to Bajaj the deal took an additional investment of 20 million Euros which is about 120 crore INR. Bajaj acquired 14.9 percent stake in KTM in 2007 at an investment of 300 crore, increasing it to 25 percent a year later. Since then Bajaj has been very keenly interested in this Austrian bike manufacturers business. A formal agreement was also signed by both the companies under which they will jointly manufacture 125cc bikes, which will be built at Bajajs Chakan plant in Pune, Maharashtra. These bikes will be exported to the European market and sold under the KTM brand. These bikes will also be exported to Sri Lanka, Bangladesh, Indonesia and Africa from India apart from the consumption in the country. Bajaj was also quick to point out about the development of the new joint venture and said products from the folio would be rolled out in European market by 2010 end. Indians will have to wait another 6 months to taste the KTM technology though. So the products would be out soon; a lot remains to be seen about the costing of the products from Bajaj as they would be manufactured here.

– Saad Khan