Bajaj to Acquire 90% Stake in KTM?

02/11/2010 @ 1:26 pm, by Jensen Beeler21 COMMENTS

Rumors are indicating that KTM has invited Indian manufacturer Bajaj to increase its stake in the Austrian company from the current 30% to up to 90%. While neither party has confirmed the news, it is reported that Bajaj has accepted KTM’s offer, and will immediately purchase an additional 21% of the company’s stock, making it a 51% majority shareholder. Bajaj will then increase its ownership to 90% at a later undecided time.

The move comes as a surprise to many industry insiders, and is likely a bi-product of the economic recession, which has deeply affected KTM’s cashflows. KTM’s invitation to Bajaj is likely an indication that the Austrian company is in need of an additional cash infusion, as it tries to piece back together its off & on-road motorcycle sales.

Bajaj’s ownership in KTM has seen the Austrian company seriously begin to bring motorcycles to the sub-500cc market segment, and is likely a driving force behind KTM’s pursuit of electric power systems in dirt bike applications.