Bajaj Auto looking to swap stake in KTM for a share in its parent

MUMBAI: Bajaj Auto has initiated discussions with KTM’s parent Pierer Mobility AG (PMAG) to swap its stake in KTM for a stake in the latter, according to a notice to the exchanges.

Bajaj Auto and PMAG hold approximately 48 per cent and 51.7 per cent, respectively, in KTM AG Austria. Bajaj’s shareholding is through its fully-owned Netherlands-based subsidiary Bajaj Auto International Holdings BV.

PMAG is listed on the Vienna, Zurich and Frankfurt exchanges. Pierer Industrie, the parent of PMAG, holds over 60 per cent in the company while the balance is free float.

The proposal envisages Bajaj swapping its 48 per cent stake in KTM AG for a stake in PMAG and both Pierer Industrie and Bajaj then moving their stakes in PMAG to a new holding company.

Both the companies had initiated similar discussions back in March 2019 but then aborted the plans. It is unclear how much stake in PMAG will Bajaj Auto get for its KTM shareholding.

PMAG owns motorcycle brands like KTM, Husqvarna and GasGas. It is Europe's leading manufacturer of two-wheelers.