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The share price of Pierer Mobility AG (which owns the KTM, Husqvarna, and GASGAS motorcycle brands, and also a 50.1% share in MV Agusta Motor) climbed by 15.7% on the Zurich Stock Exchange on Friday and by as much as 29.4% Monday. After months of bad financial news regarding huge inventories, job cuts, a production stop in January and February 2025, and a net debt of 1.5 billion Euros, many investors had lost confidence in Europe's largest motorcycle manufacturer (382,000 units were sold the previous year).
However, in the past few days, some good news from Mattighofen/Austria has also reached the public. First, Pierer announced that negotiations were being held with the major Indian shareholder, Bajaj AG. It was also rumored that energy drink entrepreneur and heir to Red Bull with 49%, Mark Mateschitz, could help KTM AG out of a jam with a financial injection, especially since he and Stefan Pierer have already founded the PIMA investment company, in order to jointly enter the globally active Austrian firefighting equipment supplier, Rosenbauer AG (Robau), as majority owner and investor.
Stefan Pierer has since denied Mark Mateschitz's involvement, while Dr. Franz Mittendorfer (Pierer Industrie AG's attorney in Linz) announced yesterday how the two-wheeler manufacturer, which has fallen into a tailspin, will fundamentally restructure its subsidiary, KTM AG. The Austrian parent company, Pierer Industrie, was the first company to initiate a so-called “European restructuring procedure” with the EU in Brussels, which aims to prevent the company from becoming insolvent. “The company is not insolvent, It is having difficulties in payments,” Karl Heinz Goetze, from the Austrian Credit Protection Association, explainedon on ORF TV yesterday.
This measure plans for requesting loans amounting to 250 million Euros. Pierer now expects a time gain of 3 to 6 months for repaying this loan. During this period, stocks of approximately 100,000 motorcycles will be reduced with up to 20% discounts, therefore, increasing the Pierer Group's liquidity, again.
In mid-November, Pierer Mobility management announced that talks were underway with its shareholder, Bajaj AG, and with existing financial creditors to secure KTM AG's financing. This involved possible bridge loans in the three-digit million Euros range, as was reported at the time. The goal is to secure KTM's liquidity and put the company back on stable operational footing.
However, if the measures being considered by the holding company, KTM AG, are implemented, the holding company could become insolvent, according to a statement issued by Pierer Industrie on Monday. This is why proceedings have been initiated, in accordance with the Austrian Restructuring Act, in order to safeguard the stability of the group.
If the measures planned for KTM - which are currently still being examined - are actually implemented, Pierer Industrie will be threatened with an early maturity of the outstanding capital amounts of certain bonds and promissory note loans. This, in turn, would lead to the insolvency of Pierer Industrie AG. The restructuring process that has now been initiated involves extending the repayment dates. According to Pierer Industrie, there should be no reductions and the current interest payments should also be met as agreed.
All other liabilities would be fulfilled, also as agreed. Yesterday, it was announced that Pierer Industrie AG is not over-indebted. Attorney Franz Mittendorfer: “The goal is to prevent other financing arrangements at Pierer Industrie AG from falling due, in view of this situation at KTM AG.”
Pierer Industrie AG's spokepersons credibly emphasize that the group is not over-indebted. Pierer Industrie AG holds 50.1% of Pierer Bajaj AG that, in turn, owns just under 75% of Pierer Mobility, listed on the SIX Swiss Exchange. KTM AG is a wholly-owned subsidiary of Pierer Mobility.
KTM has been manufacturing motorcycles since 1953. Today's company is the result of a series of former restructurings.
