Bajaj Auto Intends To Take Over KTM

KTM is alive! Yes, that’s the big news as Bajaj Auto announced today that it intends to save the Austrian brand from going bankrupt. The Indian two-wheeler giant plans to take control of KTM via its wholly owned subsidiary Bajaj Auto International Holdings BV (BAIHBV), which plans to take full control of KTM. However, the necessary regulatory approvals are pending. Bajaj has already raised a debt funding package of €800 million (₹7,762 crore)  to enable the continuity of KTM. The above money will be used to pay off the creditors, thereby ensuring the company doesn’t go bankrupt, and the fresh investment will be employed to revive operations and the working capital cycle.

Bajaj Auto has already infused €200 million (₹1,940 crore) into KTM over the past few months and the rest is being added now. Bajaj Auto’s current stake in KTM is 37.5 per cent and this will turn into majority, subject to approvals from the Austrian authorities. Just a few days back, Bajaj had raised €450 million (₹4,366 crore) via BAIHV, and we had predicted that this money would be utilised to save KTM from insolvency proceedings, the deadline for which was May 23. The company further added that the Austrian Court will confirm the restructuring plan by mid-June 2025, post which the amount will be released to the creditors and then the proceedings to restructure KTM and its subsidiaries will conclude. 

The immediate next step is to secure binding restructuring orders from the Court in Austria to mark the end of the self-administration process and settle the creditors’ quota. Alongside, applications are being made to the Austrian Takeover Commission, Foreign Investment Control and Merger Control Authorities, as applicable, for their approval. Till such time these are received, the current control setup shall stand still and prevail. Finally, after months of stoppage, the production of bikes and the supply of parts, garments and accessories to the markets will be started.

The first step after Bajaj Auto gets ownership of KTM will be to reconstitute the Board, and members from the Bajaj Auto Board might also be added. As mentioned before, the priority will be to restart production of KTM bikes, regain dealer confidence and ensure that KTM as a brand and its products return to its former glory. 

The press release also mentioned “potential partnerships and collaborations”, which leads us to believe that higher displacement KTM motorcycles might be built in India or the existing CF Moto partnership of KTM might be further solidified or it might even end. But for now, these remain speculation; what's definite is that KTM’s future has been ensured, and we’re glad for the same. If Bajaj does get full control of KTM, it will join other international two-wheeler brands under Indian ownership which includes Royal Enfield, BSA and Norton.