The deal, likely to be announced before Christmas, will see the Munjal family buying Honda's stake through a special purpose vehicle (SPV) by raising a bridge loan, the newspaper said, citing persons familiar with the development.
Hero Honda is India's largest motorcycle manufacturer.
The Munjals will divest 60-70 percent stake in this SPV to a group of two to three private equity firms to pay back the loan, the paper said, adding Carlyle, Kohlberg Kravis Roberts & Co, TPG, Bain Capital and Warburg Pincus were in the fray.
Officials at the Hero Group, Honda Motor, and the private equity firms could not immediately be reached by Reuters for comment.
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