PIERER Mobility AG / KTM
April 11, 2025 update
Until now, I’ve shared most of the official market notices issued under EU regulatory law concerning the listed company. However, the latest statement released last week introduced a new layer of complexity. While I might be able to put my Quarterly BAS together okay, that is about as far as my knowledge goes when it comes to financials. With that in mind, I reached out to business and finance guru Dario de Wet to help explain the current state of affairs in light of the most recent developments.
KTM Crisis 2025
Restructuring, Job Cuts, and the Bajaj Takeover Explained
It’s no secret that KTM AG, once one of Europe’s most prominent motorcycle manufacturers, is under severe financial stress (to put it mildly). While the jury is still out on whether this is self-inflicted, this is a sad story for everyone involved in the global motorcycle community.
Playing a critical role in the lives of many, whether employees or customers, KTM has endured a whirlwind of events since PIERER Mobility AG initiated self-administration proceedings in late 2024—a form of insolvency protection allowing restructuring.
To put it bluntly, KTM AG is in restructure-and-recovery mode: over 1,800 jobs have been cut, production has been deliberately reduced, and Stefan Pierer has resigned as CEO of KTM AG and PIERER Mobility AG, handing the reins to Gottfried Neumeister during the restructuring process.
But let’s take a step back. Many loosely refer to “KTM,” but in fact, they’re actually talking about PIERER Mobility AG — the parent company behind KTM, Husqvarna, GasGas, and until recently, MV Agusta. Over recent years, PIERER Mobility AG acquired these various subsidiaries, taking on significant levels of debt to finance the deals — whether sound or not is up for debate.
Then came overproduction. KTM got ahead of itself, producing too many bikes off the back of inflated, pandemic-driven forecasts. As global economic conditions worsened, consumer demand collapsed. Dealerships were flooded with unsold stock. And that, predictably, brought everything to a grinding halt.
How Bad Is It, Really?
By the end of December 2024, PIERER Mobility’s equity had eroded by over 50%, triggering self-administration — a European market mechanism allowing a 90-day window to restructure, reorganise, and secure financing before facing full insolvency.
As a result, the company’s equity turned negative, triggering a legal obligation to convene an Extraordinary General Meeting (EGM) under EU law. That meeting will take place on April 25, 2025, at the House of Brands in Munderfing.
What’s the Escape Plan?
As part of the effort to fulfil the 30% cash quota of KTM Group’s restructuring plan, the company intends to adopt new capital measures at the EGM. The Executive Board and Supervisory Board will propose the following at an issue price of €7.50 per share:
Phase I: Cash Capital Increase
The company will issue €150m in new shares at €7.50 each. Existing shareholders have statutory subscription rights, meaning they’ll have first access. Any unsubscribed shares may be taken up by Pierer Bajaj AG, in line with standard public offering procedures.
Phase II: Capital Increase in Kind
A second, non-cash capital increase of €200m will be executed, involving the conversion of loans (i.e., debt) provided by Bajaj Auto via Pierer Bajaj AG into equity. In simple terms: existing debt will be exchanged for shares. This will increase Pierer Bajaj AG’s stake in the company and can only be executed once the restructuring process concludes successfully.
The Ownership Twist
The twist here lies in the structure of ownership. Pierer Bajaj AG holds 49.9% of KTM AG, with PIERER Mobility AG controlling the remainder. The capital increase would flip majority control to Pierer Bajaj AG.This means existing shareholders won’t have subscription rights on the capital increase in kind, and therefore won’t be able to maintain their proportional ownership.. Pierer Bajaj AG will contribute €150m of existing loans, plus an additional €50m in future loans, all exchanged at €7.50 per share. This gives them a controlling stake (over 50.1%) in the company.
The first 75% of those funds will go directly towards restarting production, with the goal of ramping up to full capacity within three months. While this could protect some jobs, remember that 1,800 people were already laid off. And the big question remains: where are these new bikes going to go, and who’s going to buy them, with the market still oversupplied?
Another important clause: Pierer Bajaj AG has an extraordinary termination right. If the plan doesn’t go through as expected —for instance, if the EGM resolution is challenged in court — they can walk away. In layman’s terms: “We’ll take shares instead of repayment, but only if the deal isn’t disrupted.” Given their current stake, though, I believe a legal challenge is unlikely — it would worsen the situation for all shareholders.
Who Decides KTM’s Fate?
None of this is approved yet. It’s a proposed solution. Current CEO Gottfried Neumeister and new Chairman of the Supervisory Board, Stephan Zöchling (who injected a significant double-digit million euro sum during the December restructuring), are advocating for local control. Their stance will be voted on at the April 25th EGM in Munderfing.
If approved, it would dilute existing shareholders by increasing total share capital by roughly 2.4x. But it would also help fulfil the 30% (€600m) cash quota tied to the restructuring, which is being overseen by Austrian courts following 3,847 creditor claims filed in February 2025. KTM reportedly owed more than €1 billion to 180 banks.
The company’s 2024 financials were brutal: revenue fell 29% to around €1.9 billion (down from €2.7 billion in 2023). Dealer sales slumped, cash flow dried up, and operating losses surged, with EBITDA collapsing to -€300 million.
Will Bajaj Call the Shots?
With power shifting toward Pierer Bajaj AG — and, by extension, Indian auto giant Bajaj Auto — the future of KTM is uncertain. Is Bajaj using KTM as a shortcut into the global premium motorcycle market? Possibly. They certainly benefit: KTM’s brand equity gives Bajaj access to Western markets, while Bajaj’s distribution in Asia and LATAM unlocks scale synergies. KTM’s R&D could also help Bajaj drive cost savings and fuel the shift to electric, especially if some production is moved to India.
They have until June 2025 to complete the €600m creditor payment to finalise control — no small feat, especially considering the slowdown in India’s domestic market.
Meanwhile, Chinese partner CFMOTO, rumoured to be eyeing a stake, did not proceed with an offer. Other rumoured interested parties include Canada’s BRP Group (owner of Rotax) and Austrian industrialist Siegfried Wolf (ex-Magna Europe).
Yes, ownership dilution means less diversity in decision-making. But that isn’t necessarily bad. Stefan Pierer clearly overextended himself — and someone needs to clean up the mess. There will be changes. There has to be.
What this all means for KTM’s racing operations, particularly MotoGP, remains uncertain. This season’s results have been underwhelming, and rumors of rider discontent persist, though neither Pedro Acosta nor Enea Bastianini has publicly signalled an exit. The financial news reportedly blindsided their riders collectively, a situation Liberty Media and incoming CEO Derek Chang are likely monitoring closely as they finalise the Dorna acquisition.
