The GPOne.com exclusive announcement from Sunday was officially confirmed today by the management at Pierer Mobility AG and KTM AG. The financial holding company, Pierer Mobility AG, and the insolvent motorcycle manufacturer, KTM, have reportedly received financing commitments to meet the 30% cash quota in KTM's insolvency proceedings. The companies communicated this in an ad hoc announcement late Tuesday. This indicates that the payment of approximately €600 million Euros will be made midnight on the scheduled of May 23rd. Originally, the agreement with Insolvency Administrator Peter Vogl was that the €600 million would be paid to creditors within two years. Since several banks demanded a quota higher than 30%, and had even threatened to file a lawsuit for delaying bankruptcy, KTM's Board of Directors offered to pay the 30% quota by May 23rd, 2025. This proposal was accepted at the decisive creditors meeting in the winter.
After the first positive reports over the weekend, the price of Pierer shares climbed by 18.7%t on the Vienna Stock Exchange yesterday.
Restructuring Administrator Peter Vogl confirmed that a financing commitment to pay the quota was received on Tuesday. The money must be transferred by May 23rd. Only then can bankruptcy be averted. On November 29th, 2024, KTM applied for restructuring proceedings with self-administration, due to its insolvency. The number of creditors that filed claims was 1,200, totaling approximately €2.2 billion Euros. Liabilities totaling €1.8 million Euros were confirmed by Peter Vogl.
KTM's managers have kept corporate communications to a minimum in recent months, in order to bring the company back on track. The reason was because some unavoidable bad news had to be announced, including two production shutdowns. The first lasted from December 13th to March 17th, the second from the beginning of May to July 27th, 2025. The second shutdown occurred due to an insufficient supply of spare parts for the more than 70 KTM, Husqvarna, and GASGAS models.
KTM's new CEO, Gottfried Neumeister, does not want to comment publicly on the details before May 22nd because the process and the signing of the relevant documents is still underway. However, over the weekend, news was leaked that Bajaj, KTM's major Indian shareholder and strategic KTM partner, had secured a loan of €566 million Euros and would save KTM from collapsing. Bajaj celebrated the production of its one-millionth KTM motorcycle in January 2023. They produce all models with a maximum engine size of 390 cc.
CEO Gottfried Neumeister admitted his relief in a written statement today: "The financing that was secured is a strong signal of confidence in the future viability of the company and our brands." The financing is "a significant milestone for the stabilization and strategic relaunch of KTM AG, especially for our employees, customers, dealers, partners, suppliers, and the entire KTM community," Neumeister said.
The news of Bajaj rescuing KTM was first reported in India by the online platform, ndtvprofit.com. The US bank, JPMorgan Chase, DBS Bank from Singapore, and Citigroup, headquartered in New York, will guarantee the loan. With this step, Bajaj also wants to secure significantly greater say in the company and ensure KTM's continued existence.
KTM's parent company, Pierer Mobility, had already appoint the US investment bank, Citigroup, to search for backers in December. KTM's Indian co-owner, Bajaj, had always been interested and had already paid €200 million Euros in several installments by April 1st, in order to finance the costs for the start of production in March. However, the question remaisn whether the 230,000 motorcycles envisaged in the 2025 business plan will actually be built this fiscal year. Only 4,200 bikes will be completed by July 27th.
The creditors approved the restructuring plan by a majority vote at the Ried im Innkreis Regional Court on February 25th. If the money from investor Bajaj reaches restructuring administrator Peter Vogl in time by Friday, court confirmation of the transfer is still required. The Creditors Protection Association, Creditreform, expects the insolvency court to transfer the money to creditors in the second half of June.
The cash from India will naturally also have an impact on KTM's future ownership structure. Bajaj will certainly want to receive compensation for its upfront investment of almost €800 million Euros. Currently, KTM AG is wholly owned by Pierer Mobility AG, which is 74.18% owned by Pierer Bajaj AG. Stefan Pierer's Pierer Industrie AG holds a 50.1% stake in Pierer Bajaj, and Bajaj Auto International Holdings B.V. in the Netherlands holds a 49.9% stake. he Indians are expected to increase their shareholding at the expense of Pierer's group of companies and seek to take control.
What will happen to KTM, and its approximately 4,000 employees after the restructuring, as well as to what extent production in Mattighofen and jobs in the Innviertel region will be retained, remains to be seen. Pierer Mobility shares rose 8.33% to €22,100 on Tuesday. A low was reached on December 24th at €7.90. On May 5th 2025, the Pierer share was still trading at €10.84.
These recent events should also provide relief for all employees of the KTM Factory Racing department in Munderfing, and the continuation of the "Ready to Race" strategy is assured for the foreseeable future. Whether the new majority owner will impose further cost-cutting measures on motorsport activities in 2026 also remains to be seen. In 2025, the Pierer Group will have no fewer than 40 factory riders under contract. However, the racing budgets of Husqvarna and GASGAS have been drastically cut.
No one, today, can predict if KTM will actually sign a new 5-year MotoGP contract with Dorna, from 2027 to 2031. This will also depend on the earnings situation, sales figures, the return to profitability, and the plans made by Rajiv Bajaj, Managing Director & CEO of Bajaj Auto Limited.