28.07.2006 – 08:06

KTM Power Sports AG

euro adhoc: KTM Power Sports AG
Strategic management decisions
Polaris & KTM to Continue Strategic Partnership As Independent Companies CROSS Industries AG has decided: KTM remains independent

  Disclosure announcement transmitted by euro adhoc.
  The issuer is responsible for the content of this announcement.

28.07.2006

Minneapolis/Wels, July 28, 2006 — Polaris Industries Inc. (NYSE/PSE:
PII) and KTM Power Sports AG ("KTM") today jointly announced that
they will continue their strategic partnership at an operational and
technical level but that they no longer anticipate that Polaris will
acquire a majority equity interest in KTM. On July 19, 2005 the
companies announced that Polaris purchased approximately a 25 percent
interest in KTM and that Polaris and KTM’s largest shareholder, Cross
Industries AG ("Cross"), had entered into an option agreement which
provided that, under certain conditions in 2007, either Cross could
purchase Polaris’ interest in KTM or, alternatively, Polaris could
purchase Cross’ majority interest in KTM.  On July 19, 2005 the
companies also announced that during the first phase of the
partnership each company would be run independently and that Polaris
and KTM would work on several specific cooperative projects.

"Our teams have worked well together over the past year.  The
strategic partnership has accomplished a tremendous amount so far and
achieved nearly all our goals during the first 12 months of its
existence." said Tom Tiller, Polaris’ CEO.  "For instance, in
February of this year Polaris and KTM entered into a long-term
exclusive engine supply agreement for ATV applications and in March
of this year KTM became Polaris’ distributor in Germany.
Additionally, our co-development projects are progressing nicely and
we expect to make an exciting announcement in the near future. These
and other joint cooperation projects will continue into the future.
I expect the technical cooperation between our companies to continue
to be strong in the coming years."

"We are very pleased with the results of the first phase of the
strategic partnership and look forward to continue the relationship"
said Stefan Pierer, KTM’s CEO.  "Nevertheless, Rudolf Knünz (the
other principal in Cross) and I have recently informed Polaris of our
intention not to sell Cross’ interest in KTM to Polaris.  We wish to
remain in control of KTM and for KTM to remain an independent
company."

Tom Tiller concluded, "When we structured Polaris’ path toward
complete ownership of KTM as a 2-staged process, we recognized that
this was a possible outcome. Polaris continues to own a 25 percent
equity interest in KTM and we continue to have confidence in the
KTM’s management team and their ability to execute the KTM
operational plan."

end of announcement                               euro adhoc 28.07.2006 07:30:00

Further inquiry note:

KTM Power Sports AG
Mag. Michaela Friepess
Telefon +43 (0) 7242 / 694 02-113
mailto:ir@ktmpowersports.com

Branche: Economy, Business & Finance
ISIN: AT0000645403
WKN: 726812
Index: ATX Prime
Börsen: Wiener Börse AG / official dealing