Bajaj Comes To KTM’s Rescue, Lends ₹455.55 Crore To Recommence Production From Mid-March

After going into self administration in late 2024, KTM has found the required help for its financial problems from its partner in India. Yes, Bajaj’s recent investment in Pierer-Bajaj AG has come to the Austrian brand’s aid, making sure that future generations will continue to “Ready To Race.” In the agreed upon restructuring plan, 30 percent of the debt (€548 million or ₹4992.82 crores) will need to be paid off until May 23, 2025.

Also Read: KTM 390 Adventure First Ride Review

Austria’s credit protection agency – KSV1870 – has shared details with an Austrian news agency of the agreed upon plan where Bajaj’s as well as another secret investor’s joint efforts have made them KTM’s saviours. This will help the brand restart production at the Mattighofen plant itself, unlike another proposal that was supposedly also being considered. The other proposal, which was likely from BMW Motorrad, would have seen the firing of the workforce in Austria, and responsibilities of R&D and production being shifted to Munich and India respectively.

Pierer Mobility, the parent company of KTM, has officially released the following statement:

"At today's restructuring plan meeting, the creditors accepted the restructuring plan submitted by KTM AG. This plan provides for creditors to receive a cash quota of 30% of their claims in the form of a one-off payment (cash quota). In order to fulfil the quota of 30%, KTM AG must deposit an amount of €548 million with the restructuring administrator by May 23, 2025 at the latest. The court will then confirm the restructuring plan at the beginning of June 2025 and the restructuring proceedings of KTM AG will end once it becomes legally binding."  

"To enable production to be ramped up again gradually from mid-March 2025, KTM AG will be provided with financial resources totalling €50 million (₹455.55 crore) from the extended circle of shareholders. With the approval of the reorganisation plan, this amount will now be transferred to KTM AG to cover the costs of the phased resumption of production in March 2025. The planned full capacity utilisation of the four production lines in single-shift operation is to be achieved within three months."

Details regarding Bajaj’s increase in stake in KTM, or Pierer-Bajaj or Pierer Mobility AG itself are yet to be revealed.

Source: OE24