KTM-Restructuring Procedure: 2.2 Billion Euros in Claims Registered

About 1,200 creditors have made claims amounting to approximately 2.2 billion euros in the KTM restructuring process. In addition to this, over 12 million euros in employee claims have been added. Further claims are expected to follow. The self-administration will continue. This was reported on Friday by various creditor protection groups after the review meeting of KTM AG in Ried.

Decision on Restructuring Quota after KTM Bankruptcy in February

The decisive date will be February 25, when creditors will vote on the restructuring quota. KTM had recently offered 30 percent and wants to pay within two years. KTM will only be able to serve this quota of 30 percent or more with the help of investors, expects insolvency administrator Peter Vogl. The investor search process initiated by the company has apparently gone satisfactorily. 20 interested parties have reportedly registered. How many of them have made an offer or at what amount, he could not say. But there are several. It is certain that the Indian partner Bajaj is among them, and the media also speculate about CF Moto from China and FountainVest from Hong Kong. In any case, more than 600 million euros need to be raised.

As for the future of KTM in motorsport, Vogl could not yet say whether there will be a long-term reduction. This will also depend on the new owners. It is certain that KTM is bound by contracts until 2026, an early exit would result in penalties. Christopher Schipper, Managing Director of KTM Austria, recently emphasized that they will be involved in MotoGP at least until 2026 and that an engagement beyond the coming year is conceivable. Whether too much money has flowed into the area, as creditor protectors suggest, Vogl did not want to evaluate. The annual KTM expenditures for the motorsport sector are said to have amounted to 95 million euros, 46 million of which were for MotoGP alone.

140 Financial Creditors after KTM Bankruptcy

According to Vogl, 1.7 billion euros in claims relate to banks and other financial creditors, a total of around 140 in number. About 500 million euros are provisionally disputed by the restructuring administrator, reported the KSV. "From a creditor's perspective, an investor's entry and the continuation of the company make economic sense. In the event of a bankruptcy court closure and breakup of the company, creditors would receive a significantly lower quota," expects Karl-Heinz Götze from KSV, and jobs would also be lost. The decisive date will be February 25, when creditors will vote on the restructuring quota. According to the Alpine Creditors Association (AKV), initially mainly intra-group claims are disputed as well as claims for damages from suppliers and the claim registrations of creditors who have asserted rights of segregation because they assert retention of title. As for these claims, the restructuring administrator is still checking.

Only 2,000 Employees Left after Layoff Waves at KTM AG

According to Creditreform, the main causes of insolvency are declining end-customer demand, high inventory, the decline in the contribution margin in 2024, factoring with long payment terms, high expenditures for research, development and motorsport and high external capital requirements, but also loans to affiliated companies and loss financing of Pierer New Mobility GmbH and MV Agusta. However, the intra-group payment flows are usual according to Vogl. The entire KTM group had around 6,000 employees at the end of 2023, currently there are 4,400 employees, of which just under 2,000 are at KTM AG, Vogl calculated. At the opening of insolvency, KTM AG still had about 2,500 employees. At the moment, the factory is at a standstill after the - according to creditor protectors so far largest insolvency in Upper Austria. In January and February, there was a business interruption with wage and salary cuts due to the high inventory. However, Vogl has good news for the workforce: operations are to be resumed on March 17. AMS and the state of Upper Austria have set up an insolvency foundation, which starts on February 10, offers a total of 400 places and is also open to those affected by the KTM layoff waves, as State Councilor Markus Achleitner (ÖVP) announced on Friday.

(APA/Red)

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