Australia’s Automotive Holdings Group (AHG) will sell its majority share in its motorcycle distribution division. The move could give AHG an $18M cash infusion for Australia’s largest motor vehicle seller.
100 Percent to KTM
The deal has AHG selling its 74% stake in Motorcycle Distributors Australia (MDA) to Austrian motorcycle manufacturer KTM Sportmotorcycles. In return for the purchase, KTM gets 100% of the Australian and New Zealand distribution rights for KTM and Husqvarna motorcycles as well as WP suspension.
AHG has held 100 percent of the distribution rights to KTM for Australia since 1994. They also held a 74% stake in New Zealand distribution. KTM has held a 26 percent stake in MDA since 2017.
The deal is seen as significant. MDA sells more than 11,000 KTM and Husqvarna units per year on a combined basis. Currently, the Australian and New Zealand markets are the third largest market in the world for KTM.
MDA’s General Manager and former motocross champion Jeff Leisk had this to say about the deal.
“I am extremely proud to have seen the KTM and Husqvarna Motorcycle brands go from strength to strength in both the Australian and New Zealand markets. We have built strong relationships with our dealers and our customers and this has been the key to our success.
“Becoming a factory owned subsidiary will increase the level of support that we can offer our dealer network, our staff and our customers, so I am excited about the next chapter.”
KTM’s Chief Marketing Officer Hubert Trunkenpolz said:
“We are absolutely delighted with the outcome and our full ownership of KTM Group Australia and KTM Group New Zealand.
“This transaction once again reinforces our commitment to the Australian and New Zealand markets. This is a very positive development for the KTM dealer network and the KTM customer in both countries.”
The deal will take effect on July 1, 2019.
Feature image credit: KTM