Bajaj Auto board approves Rs 1,364 cr investment in Netherlands arm

Bajaj Auto Ltd on Friday said its board has approved an investment of up to Euro 150 million (Rs 1,364 crore) in its wholly-owned arm, Bajaj Auto International Holdings BV, Netherlands, to fund the needs of the latter towards investment opportunities.

The board of directors at its meeting held on Friday have accorded approval to invest funds up to Euro 150 million in Bajaj Auto International Holdings BV, Netherlands (BAIH BV), the company said in a regulatory filing.

The investment could be either in the form of equity capital, preference capital, loan -- convertible or otherwise, as may be determined in the due course, in one or more tranches, it added.

 

The capital infusion will be made in one or more tranches depending on the fund requirements up to March 31, 2026, the company said.

BAIH BV is a wholly-owned subsidiary of the company and is engaged in the business of investment.

"The additional capital infusion by the company is to fund the needs of BAIH BV towards investment opportunities," the filing said, adding necessary approval for the additional investment in BAIH BV, which is a foreign subsidiary has been obtained from the Reserve Bank of India.

Although the company did not elaborate the "investment opportunities", the development comes at a time when Bajaj Auto is heavily linked with the possibility of increasing its stake in the financially stressed KTM AG to bail out the Austrian bikemaker that has been undergoing a judicial restructuring.

Bajaj Auto through BAIH BV holds a 49.9 per cent stake in its associate - - Pierer Bajaj AG (PBAG) in Austria. The remaining controlling stake in PBAG is held by Pierer Industrie AG.

PBAG holds a nearly 75 per cent stake in its subsidiary, Pierer Mobility AG (PMAG), the holding company of KTM AG.

Apart from being a part equity owner, Bajaj Auto is also a strategic partner for KTM as it develops and manufactures products (under 400cc) for India and exports to overseas markets.

The business in India is managed by Bajaj Auto whereas export geographies are managed mostly by KTM AG and partly by Bajaj Auto.

Last year, KTM stated that the judicial restructuring of its holding firm Pierer Mobility AG, had no impact on business related to products co-developed with Bajaj Auto for the Indian domestic market and select export markets.

However, it impacted the business of Pierer Mobility AG/KTM AG that is run out of Austria, including exports from Austria, India and China to its key markets in the US and Europe.