First sigh of relief

KTM

Friday at 10 a.m. it was clear: the continuation of KTM AG has been approved. The restructuring plan will not be voted on until February.

(Bild: Markus Wenzel (2))

Does KTM have a chance of winning the fight for survival? Three weeks after the opening of insolvency proceedings, the first hearings in the three restructuring proceedings at the motorcycle manufacturer took place on Friday. At 10 a.m. it was clear: the court has given the green light for the continuation of operations. The planned job cuts of 500 employees at the beginning of 2025 are to be reduced to a maximum of 300.

It was a marathon of appointments for the insolvency judge, for the creditors' representatives and for the restructuring administrators: the first reporting sessions for the three companies that had slipped into insolvency took place in two-hour intervals on Friday, December 20: first for KTM AG, then for KTM Components GmbH and then for KTM Forschungs und Entwicklungs GmbH.

Pierer Mobility manager Gottfried Neumeister entering the regional court in Ried im Innkreis on Friday morning.

(Bild: Scharinger Daniel)

First hearing lasted 50 minutes
The first hearing was immediately the most important: because only if the insolvency judge gives KTM AG the thumbs up, thus enabling the motorcycle manufacturer to continue as a going concern, will the directly associated companies, which have also become restructuring cases, be able to continue. There was a large crowd at this first hearing; the jury courtroom of the regional court in Ried im Innkreis could easily accommodate 160 people. Incidentally, you were only allowed to enter the courtroom after registering. Things got underway at 9.11 am. 50 minutes later it was clear: the green light had been given and operations could continue.

Job losses to be mitigated
At the very first hearing, the court was presented with three letters of intent from interested parties who declared their willingness to inject fresh capital into the KTM Group via the parent company Pierer Mobility AG, reports the Austrian Creditreform Association.

The planned staff reductions for all three companies have also been specified and reduced: from the originally planned 500 employees to an expected maximum of 300. 250 employees had already been laid off at the beginning of December.

The participants in the KTM hearings were able to enter the court via a separate entrance.

(Bild: Scharinger Daniel)

Pierer was not present in court
Who was there from KTM? Gottfried Neumeister from the management of Pierer Mobility attended all three hearings. He has been working alongside Stefan Pierer since the beginning of September. Pierer himself skipped the hearings at the regional court in Ried. There is also no obligation for the KTM managers to be present at the hearings.

Citigroup's involvement creates breathing space and trust with banks
The fact is that the announcement on Tuesday evening that the investment bank Citigroup has been engaged to support the talks with existing and potential new investors gives the company a lot of breathing space. Especially for the banks and institutions already providing financing, it seems credible that liquidity can be secured by taking on new shareholders - or possibly even a new owner.