Bajaj Auto has reached an agreement with its Austrian partner Pierer Industrie AG to simplify their shareholding pattern in KTM through a two-step transfer of their stakes to a new holding company. Pierer Mobility AG (PMAG) and Bajaj Auto's 100 per cent Netherlands subsidiary Bajaj Auto International Holdings BV (BAIHBV) held 51.7 per cent and 48 per cent respectively in KTM AG. Under the proposal, Bajaj Auto International Holdings will swap out 46.5 per cent (of its 48 per cent stake) in KTM AG for a stake in PIW Holding, a subsidiary of Pierer Industrie. So, BAIH BV will also become an equity holder in PIW Holding.
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After the two-step process, Pierer Mobility AG will hold 98.2 per cent stake in KTM AG. Currently, Bajaj Auto International Holdings has a 48 per cent stake in KTM AG. But after the restructuring, Bajaj Auto International Holdings will transfer 46.5 per cent stake in KTM AG to PIW Holding, a subsidiary of Pierer Industrie.
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As a second step, PIW Holding will later contribute its 46.5 per cent stake in KTM AG to Pierer Mobility AG. Subsequently, PMAG's stake in KTM AG would stand at 98.2 per cent. After completion of both steps, Pierer Industrie and Bajaj International Holdings will be stake holders in PIW Holding, with PMAG as its listed subsidiary. PMAG will continue to hold 100 per cent stake in Pierer E-Bikes, which makes conventional and electric bicycles under Ramon, Husqvarna and GasGas brands; 50 per cent stake in Kiska GmbH, a top-notch design firm, as well as a few other small sized companies in IT and Digital Marketing.
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Bajaj Auto's Board of Directors has approved in-principle the proposal, and the parties will now process necessary clearances. After the transactions are completed, Pierer Mobility AG will own 98.2 per cent stake in KTM AG, and the Pierer Group will maintain sole control over Pierer Mobility AG. Both Pierer and Bajaj will initiate competition and takeover law consultations with relevant authorities, as well as carry out necessary valuations.
