Power-sports vehicle maker Polaris
PII said on Monday it would separate Indian Motorcycle into a standalone company and sell a majority stake of the business to private equity firm Carolwood LP.
Shares of Polaris were up 11% after the bell.
The divestiture comes at a time when Polaris is looking to streamline operations as it grapples with weak consumer demand and tariffs. The company had withdrawn its annual sales and profit outlook earlier this year.
The transaction is expected to be accretive to Polaris' annualized adjusted EBITDA by about $50 million and to adjusted earnings by about $1 per share. The company expects the deal to close in the first quarter of 2026.
Carolwood has selected industry veteran Mike Kennedy to serve as CEO of the new independent Indian Motorcycle organization after the deal closes.
Kennedy has previously served as CEO of power-sports dealership group RumbleOn and aftermarket motorcycle exhaust systems maker Vance & Hines. He also spent 26 years at Harley-Davidson
HOG in various leadership roles.
Indian Motorcycle was purchased by Polaris in 2011. The legacy motorbike maker, which made popular models including the Scout and Chief, contributed approximately $478 million, or 7%, of Polaris' revenues for the trailing twelve-month period ended June 30.
Polaris also said it expects third-quarter sales to be at the high end of its earlier forecast range of $1.6 billion to $1.8 billion. It now expects an adjusted per-share profit of 31 cents to 41 cents for the quarter.
The Medina, Minnesota-based company is set to report third-quarter results on October 28.
