Bajaj Auto raises stake in KTM

Bajaj Auto has increased its stake in the European motorcycle company, KTM Power Sports AG. Bajaj has invested Euro 20 million to increase its share-holding in the European bike manufacturer from 31.92 percent to 35.67 percent.

The investment by Bajaj reinforces its commitment to KTM and highlights the significance of ‘Ready to Race’ KTM brand in its global strategy. Back in 2007, Bajaj had invested around Rs 300 crore and picked up 14.9 percent stake in KTM. The following year, the Pune based firm increased its stake in the European bike maker to 25 percent.

Both companies have also signed an agreement to jointly develop 125cc bikes, which will be manufactured at Bajaj’s Chakan plant near Pune. First products of the joint development projects will enter the European markets by end of this year, and by middle of 2011, the products will come to India.

Bajaj will distribute KTM products in India and in markets like Srilanka, Bangladesh, Indonesia and Africa.