Financial problems
Crisis at motorcycle manufacturer KTM – talks with creditors
Low demand and high inventories have led the previously so successful group into crisis. Now they want to buy important time with a kind of standstill agreement.
The economically ailing Austrian motorcycle manufacturer KTM wants to save itself with a restructuring process. As the parent company Pierer Industrie AG announced, discussions are currently being held with creditors and the core shareholder Pierer Bajaj AG regarding the necessary bridging financing amounting to a three-digit million amount. In addition, all necessary restructuring measures would be examined.
If many creditors demand their money during this phase, restructuring would hardly be possible. “The early termination of this financing would lead to the insolvency of Pierer Industrie AG,” the statement continues. This involves 250 million euros in liabilities.
The group therefore decided to initiate a European restructuring procedure in accordance with the Restructuring Regulations (ReO). Only certain creditors are affected by this procedure. All other liabilities will be serviced as agreed. The group is not over-indebted, it said.
Pierer Industrie is a European vehicle group that employs more than 10,000 people worldwide and generated sales of 3.6 billion euros in 2023.
Low demand and high inventory levels are the problem
The company recently announced that production would be reduced. This is a reaction to the high inventories due to a collapse in demand. “The aim is to stabilize costs and sales at a reduced level from the 2025 financial year and thus create the basis for sustainable competitiveness and profitability,” Pierer Mobility AG, the parent of the KTM brands, recently announced.
dpa
Source: Stern
