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There was a considerably large crowd at the regional court in Ried im Innkreis during the creditors meeting, which began today at 9 a.m. and was supposed to last until 12 p.m. Up to 100 people gathered in the courtroom of the small town in Upper Austria.
There had already been positive signals beforehand, even if individual creditor banks wanted to achieve more than a 30% quota. Besides an also considerable number of journalists, KTM CEO Gottfried Neumeister and Stefan Pierer (who wore dark sunglasses) were also present on this fateful day. There was a lot at stake for KTM's two top managers: will the planned continuation of the company work out or would there be a risk of bankruptcy and a break-up of assets?
The news was that there had been final negotiations in Ried until late last night, that even the last creditors were convinced of the success of the restructuring plan, and that they moved forward in the process.
Co-CEO Stefan Pierer had been facing legal problems for a while. According to media reports in Austria, there are indications that the request for insolvency was delayed for too long. Therefore, an investigation is being carried out into whether the insolvency was delayed. But these accusations have now been successfully refuted by management. Most banks also believed that KTM had filed for insolvency too early.
The vote was supposed to be over by 12 noon, but the result was delayed. The vote, and the counting of votes, lasted until 1:30 p.m. Since the restructuring process involves more than 2 billion Euros and many jobs, the judge was particularly scrupulous and acted according to the rules. At 2 p.m. it was clear: the restructuring plan had been accepted by KTM AG's creditors.
At today's restructuring plan meeting, the creditors accepted the restructuring plan presented by KTM AG. This provides that the creditors receive a cash quota of 30% of their claims through a one-off payment (cash quota). To meet the 30% quota, KTM AG must pay an amount of 548 million Euros to the restructuring administrator by May 23rd, 2025 at the latest. The court will then confirm the restructuring plan at the beginning of June 2025 and, once it becomes legally binding, KTM AG's restructuring proceedings will be terminated.
In order to be able to gradually ramp up production again starting mid-March 2025, KTM AG will be provided with 50 million Euros of financial resources from the expanded group of shareholders. With the approval of the restructuring plan, this amount will now be transferred to KTM AG, so that the costs for the phased-out start of production in March 2025 can be covered. The planned full capacity of the four production lines in single-shift operations must be achieved within three months.
Pierer Mobility AG, with the brands KTM, Husqvarna, and GASGAS, had to cope with a turbulent few months, since the insolvency proceedings had to be ordered on November 29th, 2024 after debts of at least 2 billion Euros had accumulated for KTM AG.
However, since the first creditors meeting on December 20th, it was apparent that restructuring administrator Peter Vogl was committed to helping the restructuring program for KTM AG's management, which revolves around 68-year-old majority owner Stefan Pierer and his new Co-CEO Gottfried Neumeister , who's 52, to achieve a breakthrough.
In the past three months, the proven "restructuring expert" Stefan Pierer has taken several steps that strengthened the confidence of the creditors (that include 180 banks) in the ailing company. In January, Gottfried Neumeister was appointed as the new CEO of KTM AG and Pierer Mobility AG. Not long after, Stephan Zöchling was appointed as the new chairman of the supervisory board. As CEO and co-owner of the exhaust system manufacturer, Remus, he offers a lot of industry experience and, according to reports, also invested a three-digit million sum in saving KTM.
In December, Stefan Pierer had already declared that he would do everything he could to save his life's work and had already contributed a reported amount of around 200 million Euros towards restructuring KTM before Christmas.
Stefan Pierer's resignation as CEO was welcomed by most creditors, who considered CEO Stefan Neumeister's new business plan to be credible and sustainable, especially since the new strong man had nothing to do with the decline of the group, which was geared towards eternal growth. Neumeister had only joined KTM on September 1st, 2024 and was presented as a potential successor to Pierer.
Until then, Neumeister had worked in other business areas. After completing his studies in international business administration at the University of Vienna, Gottfried Neumeister worked as a consultant at Siemens AG Austria. In 2003, he founded the airline "flyniki" along with Niki Lauda and, as managing director, he was responsible for the successful development of the aviation business (until it was sold to Air Berlin). In 2012, Neumeister moved to DO & CO Aktiengesellschaft, a global catering company, where he held various positions on the board, most recently as Co-CEO, from 2021 to 2023.
Gottfried Neumeister became a member of the board of directors of PIERER Mobility AG and KTM AG on September 1st, 2024. He then supported Stefan Pierer in the CEO agendas and the restructuring of Europe's largest motorcycle manufacturer.
Pierer took over KTM in 1992, after it went bankrupt, and manufactured 6,000 motorcycles in the first year, with 150 employees. In the record year of 2023, 381,155 were manufactured, after the Pierer Group acquired Husqvarna Motorcycles from BMW in 2012 and also bought 100% of GASGAS in Spain in spring 2022.
Pierer had the vision of becoming the largest motorcycle manufacturer in Europe from the start and, therefore, made several unsuccessful attempts towards buying the luxury brand, Ducati, from the Audi Group.
Nevertheless, Pierer Mobility AG established itself as Europe's largest motorcycle manufacturer as early as 2012.
In 2017, the company entered the MotoGP World Championship, and sales climbed from 1.3 to 2.6 billion Euros in the six years that followed.
During the Covid crisis, Pierer also strengthened its bicycle business that, however, turned into a million-dollar grave: a loss of 400 million Euros resulted from the expansion, which became a huge failure, with the purchase of the 12 million US Dollar brand, FELT, and the takeover of the German brand, R Raymon, causing the Pierer Group's equity to shrink increasingly.
Furthermore, the Ukraine war caused supply chains to suffer, and many motorcycle components had to be ordered from China that, above all, extended delivery times many times over.
Inflation, rising interest rates, and global economic changes brought the Pierer Group's rapid growth to an abrupt end in 2023.
The PIERER Mobility Group increased its consolidated sales by another 9.2%, to 2,661.2 million Euros (2022:2,437.2 million Euros) in the 2023 financial yea,r despite difficult economic conditions and a shake-up in the bicycle industry. However, operating profit (EBIT) fell by around 32% to 160.0 million Euros (2022: 235.3 million Euros). The operating profit before depreciation (EBITDA) was around 15% below the previous year's figure at 323.5 million Euros.
What should be noted is that, in 2023, only 1.6% more motorcycles were sold than in 2022, although the new GASGAS brand, in particular, was promoted very extensively in motorsports, from the Dakar Rally to the Motocross World Championship to the MotoGP.
But the range of GASGAS street motorcycles that was announced and planned in August 2022 never saw the light. And when Pedro Acosta secured 9 podium places and a 6th place in the World Championship on GASGAS as a rookie in the MotoGP in 2024, only off-road bikes of this brand were available for sale.
The Pierer Group didn't grow organically, but only through acquisitions. Apparently, the reaction to the stagnating sales figures was too late, and staff cuts and austerity measures were also.
In the summer of 2022, Stefan Pierer even announced that he would buy the luxury brand, MV Agusta, from the Sardarov family. In autumn 2023, Pierer acquired 25% of the severely ailing brand that, at the time, only sold 1,852 motorcycles a year and, in March 2023, he acquired the majority with 50.1%.
In the wake of the insolvency, the purchase of MV Agusta was reversed in January, bringing in a mid-double-digit million amount.
Since December 20th, it has become apparent that KTM AG will also be allowed to continue its motorsport activities, which had shrunk as a result of the insolvency, with 40 instead of 52 factory riders in 2025. The core brand, KTM, will again be much more in the foreground, and Husky and GASGAS, for example, will no longer appear in the GP sport.
The fears of some teams, opponents, and fans, that the KTM Factory Racing department in Munderfing with around 150 employees, might have to close its doors, have not come true, because restructuring administrator Peter Vogl knew that motorsports and the slogan, "Ready to Race", are as much a part of KTM's DNA as an amen is to a prayer.
Since December 20th, 2024, it was planned that, after a production stop from March 2025, around 230,000 motorcycles would be built again and the workforce of the KTM Group would be reduced from 6,100 (in 2023) to around 4,400 employees. Around 2000 of them are employed by KTM AG.
Peter Vogl initially promised creditors that the Pierer Group would repay 30% of the debts, as usual, in the two years after February 25th, 2025 as part of the insolvency proceedings.
But, after a successful capital increase by the previous shareholders, Bajaj Auto, in India and CFMOTO in China, as well as by new investors, up to 900 million Euros in fresh capital could be made available. Finall,y 7 out of 23 investors stayed on board. Bajaj wants to contribute another 150 million Euros, CFMOTO even more.
The reports that BMW would take over KTM, eliminate all jobs in Austria, move development to Munich, and production to Asia were never taken seriously in Austria. This fairy tale was dismissed as fake news. "We're not looking for an investor who wants to close the site," a KTM manager explained.
Neumeister and Pierer were able to significantly improve the offer to the creditors in the last two weeks. The plan is now to pay the promised 30% of liabilities by the end of May 2025. For this purpose, 150 million Euros of fresh money were made available for restarting production on March 17th.
Restructuring Administrator Vogl recently recommended several times to creditors that they accept KTM's offer, in order to pay 30% of liabilities by the end of May 2025, otherwise, there was as risk of bankruptcy, and the creditors would then probably only receive 14.9% of the debt.
As much of a dead weight as possible was shaken off from the 2025 motorsports activities, in order to save costs without jeopardizing the competitiveness of the motorcycles and the teams.
KTM Motorsport Director Pit Beirer assured that the four MotoGP factory riders, Pedro Acosta, Brad Binder, Maverick Viñales, and Enea Bastianini, have two-year contracts until the end of 2026.
So far, preparations for the season, starting on Sunday in Buriram, haven't suffered in any noticeable way. Because Pit Beirer was always confident that KTM's top managers would successfully complete the restructuring process.
How much of a burden have the KTM AG insolvency proceedings been for Pit Beirer, personally? "I trusted our board and our new CEO, Neumeister, and Stefan Pierer to manage the insolvency proceedings and the restructuring process perfectly. KTM Racing AG is based in Switzerland and, therefore, was only indirectly affected. The focus of the racing department was on saving costs and preparing the racing season in the best way possible. Recent events and meetings in January and February have strengthened our hope that motorsports activities will continue even after the insolvency proceedings have ended, albeit on a reduced scale."
