Bajaj Auto Subsidiary Provides Loan To Pierer Bajaj AG For KTM’s Restructuring

The loan will facilitate the financial needs of KTM AG, a European motorcycle manufacturer, which is undergoing restructuring. In order to enable PMAG to provide these funds to KTM, BAIH BV is providing a loan to PBAG which will be used by PBAG to finance PMAG, so that PMAG in turn will be able to finance the operating costs of KTM and prepare the phased resumption of the production of KTM. This transaction is being executed within the framework defined by the Administrator in Austria and its utilization is subject to a set of Conditions Precedent. If these conditions are not met, the loan will be repaid to BAIH BV.

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The €50 million (approximately Rs 455.56 crore) loan has been executed on an arm’s length basis and is classified as a related party transaction under SEBI’s Listing Obligations and Disclosure Requirements. It is structured as a shareholder loan with a three-year tenure, including an early repayment option.

Recently in a regulatory filing Bajaj Auto said that they will be investing Rs 1,364 crore or 150 million euros into its Netherlands subsidiary, Bajaj Auto International Holdings BV, Netherlands. Bajaj Auto International Holdings BV holds a 49% stake in Austrian bike maker KTM. Pierer Mobility Group holds the remaining stake in the Austrian bike maker.