Resistance Against KTM Restructuring Plan

A group of creditors is demanding higher repayments, resisting the proposed KTM restructuring plan, and presenting an alternative draft for more favourable creditor forecasts, reports the financial news agency Bloomberg.

KTM Restructuring Plan: Creditor Group Wants More Money

A group of bond creditors of the heavily indebted KTM companies, led by the US hedge fund Whitebox Advisors, wants to offer lenders more than the 30 percent provided in the company's own proposal, Bloomberg quoted on Saturday from a presentation of the lenders available to the agency. 30 percent is the minimum that KTM must offer in its bankruptcy proceedings. A representative of Whitebox declined to comment. A spokesperson for KTM parent Pierer Mobility did not respond to request emails and calls, according to the agency. A representative of the company that prepared the presentation - Perella Weinberg Partners - also did not respond.

Creditor Group for Alternative Plan

The creditor group argues that additional capital demanded by Pierer Mobility for KTM in the sense of a turnaround would be at the expense of the lenders. These would have to "accept significant discounts". Existing shareholders like Pierer Mobility of industrialist Stefan Pierer would be enabled to "buy into the company at a massive discount", according to the presentation. According to the alternative plan of the critical lenders, the existing equity of the company would be written off to zero. All creditors would be offered the opportunity to provide new financing themselves, although the creditor group is ready to secure the required financing according to the presentation. The providers of the new financing would receive 30 percent of the company's equity, while 70 percent would go to reinstated creditors, it says. Existing shareholders would then have the opportunity to buy up to 70 percent of the equity from the reinstated creditors. Even creditors who decide against participating in the new financing should receive "significantly better recovery rates".

Decisive Meeting for KTM in February

On Friday, the creditors had registered claims amounting to around 2.2 billion euros, with the insolvency administrator having so far recognised around 1.7 billion euros according to AKV. The restructuring plan - i.e. the exact future of KTM - will be voted on by the creditors on 25 February.

(APA/Red)

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