KTM Bankruptcy: 600 Million Euro Cash Quota Due on May 23
Currently, the plant in Mattighofen is at a standstill due to a lack of components. All parties are striving to exude optimism, but whether the rescue will succeed remains uncertain.
The dark clouds over the industrial empire of Stefan Pierer gathered quickly last year. A year ago, they still seemed race-ready, then waves of layoffs and other bad news accumulated, and at the end of November, things happened in quick succession: First, the overarching Pierer Industrie AG initiated a European restructuring procedure - a novel pre-insolvency procedure. A few days later, KTM AG and its subsidiaries KTM Components and KTM R&D applied for restructuring procedures. Production was also halted for three months with wage and salary cuts.
KTM Insolvency: Plant at a Standstill
At the KTM examination meeting in January, 1,200 creditors registered claims of around 2.2 billion euros, and in February they accepted the restructuring plan, according to which they are to receive a 30 percent cash quota. Although the Indian co-owner Bajaj injected money several times to secure the continuation of the plant, production was again scaled down at the beginning of May because the supply chains had suffered under the insolvency and there were no more components.
Once again, the machines are to stand still for three months, and the workforce will again be paid for only 30 hours. After that, there is hope to ramp up production again. However, the prerequisite is that the creditors receive their money by May 23 - and for that, an investor is needed. The ongoing investor process is experiencing some delays. An intended capital increase has not yet materialized, but at a general meeting at the end of April, the shareholders approved the pledging of the KTM shares held by the company. This is intended to raise money to meet the quota.
Trouble Between Pierer and Zöchling
Recently, there was also concern about tension between the long-time KTM CEO Stefan Pierer, who has since stepped back, and Stephan Zöchling, simultaneously a board member at Pierer Industrie, chairman of the supervisory board of KTM's parent company Pierer Mobility, and reportedly a potential KTM investor. Pierer is said to have pledged shares to Zöchling's Dabepo Holding, which Zöchling now apparently wants to monetize due to lack of repayment, reportedly involving 65 million euros. Pierer intends to defend against this with legal action if necessary.
Pierer's entry into the firefighting equipment supplier Rosenbauer, meanwhile, went as planned. The Robau consortium, in which Pierer, Red Bull heir Mark Mateschitz, and two companies associated with Raiffeisenlandesbank Oberösterreich are represented, now holds around 55 percent.
(APA/Red)
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