Image: Supplied.

Pierer Mobility AG has received essential financing commitments that will enable the Austrian-based group to formally fund a restructure after major shareholder Bajaj Auto secured a loan of more than $630-million (USD) in its bid to effectively save KTM.

KTM – including accompanying manufacturers, Husqvarna Motorcycles and GASGAS – has been hit by a financial crisis during the past six months, entering self-administration during November 2024 in order to avoid bankruptcy.

Upon revealing a debt of around $2.4-billion, a court-approved restructuring plan requires KTM to pay existing creditors 30 percent of its liabilities through its insolvency administrator by this Friday, May 23. It’s understood that Baja Auto has negotiated a one-year loan from JPMorgan, DBS and Citigroup that will enable the group to fulfil its requirements.

“Restructuring plans of KTM AG, KTM Components GmbH and KTM Forschungs & Entwicklungs GmbH can be fulfilled on time,” a statement from Pierer Mobility AG confirmed. “As announced, the creditors of KTM AG, KTM Components GmbH and KTM Forschungs & Entwicklungs GmbH approved a restructuring plan quota of 30 percent on February 25, 2025, payable by May 23, 2025.

“The total amount required to finance the quota under the three restructuring plans amounts to approx. EUR 600 million. Pierer Mobility AG and KTM AG have received financing commitments, subject to the execution of the requisite agreements, which will ensure that the quota payments to fulfil the restructuring plans of KTM AG, KTM Components GmbH and KTM Forschungs- & Entwicklungs GmbH can be fulfilled on time by May 23, 2025.”

It’s another important step toward what will firm the future of KTM AG, despite a recent second pause in production – this time due to supply chain shortages in Mattighofen – that is this time expected to last until late July.

Indian company Bajaj Auto has been involved with KTM for near two decades, now holding almost a 50 percent stake in the brand that had grown to become Europe’s largest motorcycle manufacturer. In January, Stefan Pierer stepped down from his position of CEO at Pierer Mobility AG and KTM AG, with Gottfried Neumeister primarily taking charge of operations.