KTM Secures Bailout Worth €600 Million
It looks like the eleventh-hour bailout of the famous KTM brand has worked, as the Pierer Mobility Group confirms a restructuring plan quota has been secured
KTM’s ongoing financial shake-up looks set to stay on schedule, after its parent company, PIERER Mobility AG (PMG), confirmed it has secured the necessary €600 million (£506.5 million) to meet its restructuring obligations.
If you've been keeping an eye on the orange camp lately, you'll know KTM AG, along with sister firms KTM Components GmbH and KTM Forschungs & Entwicklungs GmbH, has been deep in the weeds of a major restructuring effort. Back in February, creditors approved a deal that would see them receive 30 per cent of what they’re owed, so long as KTM could cough up the cash by May 23, 2025.
That deadline now looks set to be hit, as at the eleventh hour, PMG confirmed that the funding had been secured.
The full release from PMG reads:
“As announced, the creditors of KTM AG, KTM Components GmbH and KTM Forschungs & Entwicklungs GmbH approved a restructuring plan quota of 30% on February 25, 2025, payable by May 23, 2025. The total amount required to finance the quota under the three restructuring plans amounts to approx. EUR 600 million.
“PIERER Mobility AG and KTM AG have received financing commitments, subject to the execution of the requisite agreements, which will ensure that the quota payments to fulfill the restructuring plans of KTM AG, KTM Components GmbH and KTM Forschungs- & Entwicklungs GmbH can be fulfilled on time by May 23, 2025.”
While the rescue sounds like a done deal (pending final paperwork, of course), what we don’t 100 per cent know is where the funds have come from. PMG had previously called in some financial big-hitters, in the form of Citigroup, among others, to help source the available funds. However, the timing of this confirmation points to one company being behind the bailout.
Earlier this week, Bajaj confirmed that it had taken out a loan from three global finance companies, going on to say that it was to begin “exploring various alternatives to participate in the restructuring of KTM AG”. The press release from PMG doesn’t directly confirm or deny this, although all signs point to Bajaj.
The announcement will come as a relief to fans and industry watchers alike. KTM’s position in both off-road and street bike markets is seen as vital to the wider European motorcycle ecosystem, not to mentioned KTM's hometown of Mattighofen. Despite its racing success and strong product line-up, financial wobbles have been dogging the brand behind the scenes for some time now.
With the money now (nearly) in place, KTM seems to have cleared one of the final hurdles on its path to stability. Whether the company’s leaner structure can help it thrive in an increasingly competitive market remains to be seen—but for now, the orange army rides on.
Bajaj has long been regarded as the brightest hope that KTM has of putting an end to its financial struggles, given the brand's strong presence (and sizable capital), and its close links to the Austrian brand and its owner, the Pierer Mobility Group (PMG). Bajaj Auto, via (BAIH), holds a 49.9 per cent stake in Pierer Bajaj AG (PBAG) in Austria, with the remaining controlling stake being held by Pierer Industrie AG. In short, as a part-owner and technical partner to KTM via PMG/PBAG, the success of the group as a whole is in Bajaj's best interest.
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Simon (AKA Toad) has been working within the motorcycle industry for more than twelve years, and a member of the motorcyclist family since birth. Growing up around British-built single and twins, it was inevitable that a life on two wheels was on the cards, from a very early age!
