Hero MotoCorp has picked up 49.2 per cent stake in US-based Erik Buell Racing (EBR) for $25 million (about Rs 148 crore).
In a filing to the Bombay Stock Exchange, the country's largest two-wheeler maker said it has incorporated a wholly-owned subsidiary in the US by the name of HMCL (NA) Inc for the purposes of investing in Erik Buell Racing Inc.
The development is a part of the Indian firm's strategy to enhance technological prowess, post the break up of the erstwhile joint venture with Honda - Hero Honda.
"HMCL(NA) has agreed to invest $25 million in EBR for a total stake of 49.2 per cent in the share capital of EBR. The first tranche of $15 million has been invested by HMCL (NA) on June 28, 2013," it added.
The second tranche of $10 million is proposed to be invested within the next nine months.
Last year, Hero MotoCorp had entered into a technology sourcing pact with EBR as it looks to strengthen presence in the high-end bike segment. The move was part of the Pawan Munjal-led company's overall strategy to have multiple technology source for different segments and enhance its own R&D capability.
In December 2010, the Hero Group and Honda had agreed to end their 26-year-old relationship, with the Indian partner agreeing to buy out Honda's 26 per cent stake in Hero Honda for Rs 3,841.83 crore.
The two erstwhile partners had, however, signed a new licensing agreement under which Hero will pay Honda 45 billion yen (about Rs 2,450 crore) till 2014.
Shares of Hero MotoCorp were trading at Rs 1,677.55 on BSE in morning trade, up 0.92 per cent from their previous close.
With inputs from PTI