KTM saved from financial meltdown as €600m lifeline lands just in time for restructuring deadline

KTM has been officially pulled back from the brink, with parent firm Pierer Mobility confirming that a €600 million (roughly £505m at time of writing) financing package has been secured to meet the terms of their restructuring plan.

The cash injection, which has arrived just three days ahead of the May 23 deadline, means the Austrian manufacturer can now meet its court-mandated obligations and pay the agreed 30% quota to creditors – a lifeline that allows the three subsidiaries of KTM to skirt liquidation and remain operational.

This payment is part of a broader plan to write off 70% of KTM’s €2.25 billion debt – a move that was approved in early 2025 after a 90-day self-administration period starting November 29.

“Pierer Mobility AG and KTM AG have received financing commitments, subject to the execution of the requisite agreements, which will ensure that the quota payments to fulfil the restructuring plans of KTM AG, KTM Components GmbH and KTM Forschungs- & Entwicklungs GmbH can be fulfilled on time by May 23, 2025,” a statement from Pierer Mobility read.

Previously, Citigroup Global Markets Europe AG were called in to help source up to €800m in outside investment. It’s unconfirmed at this stage whether their involvement has borne fruit directly or whether the funding has come directly from inside Pierer’s existing shareholder circles.

Despite the uncertainty, all signs currently point to Indian partner Bajaj Auto. Recently, Bajaj’s European investment arm reportedly raised €566 million through unsecured loans from JPMorgan, DBS, and Citigroup – according to third party news outlets.

Although the official purpose of Bajaj’s loan is yet to be confirmed, the timing and amount come with an obvious overlap to KTM’s financial needs.

The Indian automotive giant, which holds a 49.9% stake in KTM, has previously stepped up as a major player in KTM’s resurrection, helping kickstart the Austrian brand’s manufacturing lines back in March with a substantial cash injection.

While the announcement is welcome news for the ‘Ready to Race’ brand, it caps off an arduous few months that have seen over 1850 jobs lost.

The next step in KTM’s recovery will be depositing the €600 million with the administrator. Once that’s done, the Austrian courts are expected to officially approve the restructuring plan in early June.

Even with creditors now appeased, Pierer Mobility posted troubling operating losses of €1.28bn as 2024 came to a close, with revenue down nearly 30%. Over 60,000 fewer bikes were sold last year, inventory levels have been slashed, and KTM’s withdrawal from the bicycle market is already under way.

Then there’s the still-delayed model launches – including the 1390 Super Duke GT, 990RCR, and multiple Super Adventure variants – which were shown off late last year but have yet to arrive in dealers.