Pierer Industrie AG is successfully completing the restructuring process – The future of the insolvent KTM AG will be decided next week
On Thursday (February 20, 2025), a vote of creditors on the European restructuring plan (ReO) of Pierer Industrie AG took place at the Regional Court of Wels (Upper Austria). This was the first time that these proceedings under the Restructuring Regulation, which came into force on June 17, 2021, had been applied in Austria.
In principle, the aim is to enable companies that are at risk of insolvency but are not yet unable to pay their debts to receive the opportunity to recover economically in a judicial restructuring procedure before they have to file for insolvency.
Pierer Industrie AG has sought these restructuring proceedings in order to be able to repay financing in the amount of 247.5 million euros “in full”. With the proceedings, Pierer Industrie AG wanted to be able to pay off these debts over two years.
The main focus was on the extension of bonds and promissory note loans. The hearing on Thursday afternoon lasted about an hour. The company’s proposal, submitted on December 27, 2024, was accepted.
This averted the insolvency of Pierer Industrie AG. The restructuring procedure is completed. The debts do not have to be repaid on the dates originally agreed, but on the due dates of December 31, 2026 and December 31, 2027.
Pierer Industrie AG, based in Wels, holds 50.1 percent of Pierer Bajaj AG, which in turn holds 74.94 percent of KTM’s parent company Pierer Mobility AG. Pierer Industrie AG also holds 80 percent of automotive supplier Pankl AG.
Crucial day for KTM on Tuesday
Next Tuesday (February 25, 2025), the regional court of Ried im Innkreis (Upper Austria) will vote on the restructuring plan of KTM AG and two subsidiaries. The creditors will then decide whether to approve the plan presented.
Debts of more than two billion euros have been accumulated. A total of 1,170 creditors have registered, including banks and suppliers. In addition, there are around 2,500 claims from employees.
The statutory minimum offer to creditors is a quota of 30 percent. In mid-February, KTM improved the offer with a cash quota. This means that the 30 percent offered will not be paid out over two years, as is usually the case, but by the end of May.
This money is to be provided by the owners, new investors and banks and deposited with the insolvency administrator by mid-April. It is said to be around 600 million euros. The US hedge fund Whitebox has recently spoken out in favor of a higher rate.
Meanwhile, work is also being done in Mattighofen to restart production in mid-March. The company is working on setting up the necessary liquidity, as KTM stated. The necessary 150 million euros are said to have already been provided by the owners.
The prerequisite for this is the creditors’ vote next Tuesday. If the plan is rejected, bankruptcy and the break-up of the company would be possible. In that case, no more money would probably flow for the ramp-up of production.
