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Following the meeting of the creditors committee in the KTM AG restructuring process on February 10th, 2025, KTM AG is now improving its current restructuring plan by offering creditors a 30% cash share that must be paid to the restructuring administrator by April 15th, 2025.
The investing process is currently in its crucial moment. According to KTM AG's project, financing the production recovery phase should occur by the end of February 2025 and the financing of the cash share for the creditors should be secured by the end of March 2025. The necessary financial resources should be made available by the current owners as well as new investors and banks.
The money for the payment of the 30 percent quota to the creditors was originally supposed to be made available by the current owners, new investors and banks in the two years after February 25, 2025, and to be deposited with the restructuring administrator by April 15, the company, based in Mattighofen (Braunau district), announced on Wednesday.
In total, the capital increase by the current owners and the new investors is expected to bring in around 900 million in fresh money to save the ailing company.
The production stop will end on March 17, after which around 230,000 motorcycles are to be sold again in 2025 with around 4,000 employees.
Restructuring administrator Peter Vogl explains: "If the restructuring plan is rejected and bankruptcy proceedings are open over KTM AG's assets, only a share of about 15% would be expected from the break-up of the KTM Group. The report and expert opinions on this will be completed by February 17th, 2025 and submitted to the court."
The offer from KTM AG provides for a significantly better share for the creditors. On November 25th, debts of 1.8 billion Euros were identified, and creditors have since reported total liabilities of 2.2 billion Euros. But 400 million Euros have not yet been accepted by Peter Vogl.
The alternative offer made to the creditors by the company, Whitebox Advisors LLC a New York, is not feasible under applicable Austrian law. Whitebox Advisors LLC wants to 45% or more for a group of creditors.
But the alternative from the USA only offers creditors the possibility of an improvement if they waive their share in the first step and also provide additional financing.
Vogl says: "If the restructuring plan is rejected in the hope of this proposal, there's a risk of bankruptcy and, therefore, a break-up."
The vote on the restructuring plan will take place on February 25th, 2025 at the Regional Court of Ried im Innkreis in Upper Austria.
