The crisis at Pierer Mobility Group persists, with KTM AG entering self-administration and effectively declaring insolvency due to unmet financing requirements.
A statement from the group reads: ‘KTM AG, a wholly owned subsidiary of Pierer Mobility AG, will apply for the initiation of judicial restructuring proceedings with self-administration on November 29, 2024. The financing requirements of KTM AG currently amount to a high three-digit million figure. The management now does not expect to be able to secure the necessary interim financing in time’.
Given the circumstances, the executive management has opted for a self-administration process over the assets of KTM AG and its subsidiaries, KTM Components and KTM F&E. This will allow operations to ,amage it under supervision while facilitating the independent reorganization of the KTM Group. None of the other subsidiaries will be affected by this measure. The aim is to reach an agreement with creditors on a reorganization plan within 90 days.
The KTM Group will undergo redimensioning to ensure its viability, with operating performance in Austria expected to reduce by over a €1 billion in 2025 and 2026. The restructuring process may result in further losses due to one-off expenses and costs associated with workforce reductions, among other expenses. The financial results for the 2024 fiscal year are expected to close with a ‘very high three-digit million’ negative outcome.
According to Bloomberg, on Monday, Pierer Industrie AG requested creditorsto extend the maturity of nearly €250 million in debt. The industrial crisis in Europe and a weakened demand for motorcycles have significantly contributed to the challenges faced by the Austrian group, which is experiencing one of the most delicate moments in its history.