Polaris Plans to Spin Off Indian Motorcycle Business

Polaris Inc., a maker of power-sports vehicles, announced that it intends to turn Indian Motorcycle into an independent company by selling a majority stake to Carolwood LP, a private equity firm. Subsequently, Polaris stock was up over 11% in the after-hours trading.

The divestiture is a part of a larger plan by Polaris to simplify its operations in light of lower demand and tariffs. This follows the company’s decision to withdraw its yearly sales and profit forecast. The firm anticipates that the transaction will unlock about $50 million of annual adjusted EBITDA and lift adjusted earnings by around $1 per share, with the closing of the deal expected in the first quarter of 2026.

Mike Kennedy has been appointed by Carolwood to take on the CEO role at the newly independent Indian Motorcycle company. Kennedy’s career history is long, and he was executive director of RumbleOn, Vance & Hines, and spent 26 years at Harley-Davidson in several management capacities.

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Indian Motorcycle, which was bought by Polaris in 2011, is an American company famous for its historically significant models like the Scout, and the Chief. The brand was responsible for approximately 7% of the last 12 months’ of Polaris revenues, or $478 million, ended on June 30.

Polaris has also made predictions about its third-quarter results, forecasting lower-end sales of $1.6 billion (as previously estimated) to $1.8 billion. In addition to this, the adjusted per-share earnings were expected to fall between 31 cents and 41 cents. The Medina, Minnesota-based company will be reporting its third-quarter results on October 28.

Indian Motorcycle is expected to gain more freedom in its operations, while Polaris will be able to better concentrate on its core business of power sports, as a result of this strategic move.