India's Hero Motorcorp has taken a 49.2-percent stake in Erik Buell Racing at cost of $25 million; $15 million of that is in immediate investment, the remaining $10 million to come over the next nine months. The two companies formalized a partnership in February last year, when Hero sponsored EBR's two bikes in the AMA Pro Racing series and Buell sent engineers to India to help Hero develop new products.
Things have apparently worked out, the equity stake representing Hero's faith in its partner. Until 2010, Hero was the Indian JV partner of Honda; it was known as Hero Honda and was the leader in the Indian market. But when the Japanese company divested its share after 27 years together, Hero needed to find a partner that could help it maintain its tech edge. Now that it can call its own shots it is also able to export its products, something it couldn't do when it was with Honda, and it will want offerings that can compete globally.
The investment keeps Buell in charge of his company, leaves the company headquartered in East Troy, Wisconsin, and allows EBR to continue to develop its 1190 RS road racing superbike and expand its line-up.