KTM AG, the Austrian motorcycle manufacturer, has been navigating a tough financial terrain after filing for insolvency last year. In February 2025, KTM reached a restructuring agreement with its creditors that required it to repay 30% of its total debt. This translated to a repayment of EUR 544 million (approximately Rs 5,445 crore), which was to be deposited by May 23, 2025.
Bajaj Auto Steps In With Major Financial Support
In a critical move, Bajaj Auto International Holdings BV—the European subsidiary of Bajaj Auto—has reportedly secured a loan of EUR 566 million (Rs 5,445 crore). This funding was raised from global financial institutions including JP Morgan Chase Co, DBS Bank Ltd, and Citigroup Inc.
While the loan is marked for “investment purposes” and does not directly reference KTM, the timing and structure strongly suggest Bajaj’s intent to support the troubled motorcycle brand.
Corporate Filing Clarifies Restructuring Role
In an official corporate filing to the BSE, Bajaj Auto clarified:
“Our wholly owned subsidiary, Bajaj Auto International Holdings BV, Netherlands, is in negotiations and exploring various alternatives to participate in the restructuring of KTM AG… arrangements are being finalized…”
This statement confirms that Bajaj is working closely with KTM’s creditors on a structured revival plan, although details are yet to be formally disclosed.
Production Woes Continue at KTM
Despite resuming operations in April 2025 at its Mattighofen plant in Austria, KTM’s production was once again halted after producing only 4,200 motorcycles. The reason? Supply chain disruptions leading to a shortage of essential components—another blow to the already struggling brand.
Loan Offers KTM a Lifeline and Breathing Room
The loan gives KTM a crucial one-year window to execute its restructuring plan and stabilize operations. While the company must still deposit the 30% debt amount by the May 23 deadline, the support from Bajaj’s European arm could prove pivotal in meeting that obligation.
Conclusion: Bajaj’s Strategic Investment Could Save KTM
Bajaj’s move to secure this loan reinforces its long-standing partnership and stake in KTM. If all goes as planned, the loan may not only help KTM meet its immediate financial obligations but also buy the company time to stabilize operations and re-establish its position in the global motorcycle market.
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