Bajaj Auto Limited has informed the Exchange about agreement pertaining to subscription by Bajaj Auto International Holdings BV, a wholly owned subsidiary of Bajaj Auto Limited to Convertible Bonds issued by Pierer Bajaj AG.
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Bajaj Auto's wholly owned Dutch subsidiary, BAIH BV, has subscribed to Convertible Bonds worth Euro 50 million (about Rs. 479.97 crore) issued by Pierer Bajaj AG (PBAG) on 15 May 2025. The bonds are unsecured and can be converted into shares of PBAG between June 2025 and February 2028, with maturity on 31 March 2028. The money is meant to fund the restructuring of KTM AG, Europe's leading premium two-wheeler maker, in which Bajaj has indirect exposure through its 49.9% stake in PBAG (which holds 74.94% of PIERER Mobility AG, the parent of KTM). This is the third such tranche — total outstanding convertible bonds from BAIH BV to PBAG now stand at Euro 150 million, with previous subscriptions on 31 March 2025 and 3 April 2025. The transaction is a related party deal, carried out at arm's length and approved by the Audit Committee.
For shareholders, this signals continued financial support to Bajaj Auto's European KTM-linked partner during its restructuring, which protects the value of Bajaj's indirect exposure to KTM but also ties up roughly Rs. 480 crore in a single related-party exposure. Investors should watch KTM's restructuring progress and the conversion terms, as these bonds could eventually dilute Bajaj's effective stake in the European business.