Pierer Mobility places KTM AG in receivership

Pierer Mobility places KTM AG in receivership
Pierer Mobility places KTM AG in receivership

KTM begins a crucial period for his future. The group Pierer Mobility has just announced that it is asking to place its subsidiary KTM AG in judicial recovery in self-management. A procedure close to that existing in but more autonomous in its Austrian version. This request should be made on November 29which will leave a period of 90 days to the manufacturer to establish a financing plan in accordance with its creditors. The group arrived at this stage faced with the impossibility of finding the hundreds of millions of euros necessary for its survival in time. THE board of directors therefore decided to file this request for opening of procedure.

90 days to reach an agreement

Subsidiary at 100 % de Pierer Mobility, KTM AG generates the majority of the group's turnover. This judicial recovery procedure concerns the assets of KTM AG but also on its own subsidiaries KTM Components GmbH et KTM F&E GmbH. Elle does not concern distribution subsidiaries of the manufacturer. In parallel with this procedure, the firm will continue the gradual reduction of its production, already announced several weeks ago. This step should allow reduce your stocks as well as those of its distributors. However, the group planned tospread this reduction over two yearswhich will decrease operational performance Austrian production sites up to of a billion euros over the years 2025 et 2026 according to the company. A horizon that cannot be reached only on the condition of reaching an agreement with the creditors during the next three months. Whatever happens, this restructuring will cost even more to the manufacturer, who will have to face expenses linked to layoffsto capitalized development costs and toother miscellaneous costs. The current financial year should therefore end with a net loss of several hundred million euros.

What possible outcomes?

The procedure launched by Pierer Mobility will allow 90 days for Stefan Pierer and his team for pursue the reorganization of the group as a whole, while trying to find an agreement with the various creditors. However, work carried out sous supervision under the Austrian procedure. “The KTM brand is my life’s work and I will fight for it” states thus Stefan Pierer in a press release from the group. However, the future of KTM is not probably no longer in the hands of the managermore between those of the banks who constitute a significant part of the creditors. Establishments some of which could choose to convert their debts into shareswhich would make the group pass in the hands of financierswhile ensuring its survival. Some foreign manufacturers could also show up interested by one participationlike the Indian Bajajwhich already holds shares through Pierer Bajaj AG. Others Chinese manufacturers might also be interested, as CF MotoWho made already engines and machines for KTM, while operating one of the engines from the Austrian brand. Whatever the outcome, the manufacturer now has 90 days to get out.

France

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