Hero MotoCorp, world's largest two-wheeler maker by volume, has entered into a settlement agreement related to the bankruptcy protection of US-based sports bike maker Erik Buell Racing (EBR) and has agreed to acquire its consulting business for $2.8 million, according to a stock market disclosure.
It will acquire certain tangible and intangible assets of EBR entities, free and clear of all encumbrances, it said.
The move would allow the Indian bikemaker's R&D team to continue with some of the projects for which EBR was providing services.
In 2013, Hero MotoCorp, through its US-based wholly owned subsidiary HMCL (NA) Inc, had bought 49.2 per cent stake in EBR for Rs 150 crore. In April this year, EBR had declared bankruptcy and shut down its operations.
EBR is a five-year-old firm started by Eric Buell, a former executive with the iconic motorcycle maker Harley Davidson. Buell had earlier formed Buell Motorcycle Company, but eventually sold it to Harley Davidson. After Harley Davidson shut Buell Motorcycle a few years ago, Buell moved out to start up again. Harley Davidson continues to hold the brand rights for Buell but EBR is an independent venture of its founder.
Hero MotoCorp shares were trading at Rs 2528.95 each, down 2.94 per cent on BSE in a weak Mumbai market on Tuesday at 1.59 PM.