Whitebox Advisors say KTM is delaying its restructuring process
KTM is in deep financial trouble, with reported debts of up to EUR 2.8 billion and hundreds of thousands of unsold motorcycles in its inventory. It has already cut its executive board from 6 to just 2, has entered into a restructuring proceeding with self-administration, and has sold its controlling stake at MV Agusta back to the Sardarov family.
As part of the Austrian company’s restructuring process, several creditors were involved, one of them is Whitebox Advisors, LLC. This American company, according to Bloomberg, has accused KTM of delaying the restructuring process by failing to correspond to Whitebox’s letter and “purposely avoiding contact” in response to a hedge fund plan that they have introduced.
Husqvarna is KTM's sister company through Pierer Mobility
“In January, Whitebox proposed a restructuring plan that would offer at least 45% recovery for lenders, in comparison to the 30% envisaged by the company,” according to a report from Bloomberg.
This proposal, basically allows all of KTM’s lenders new financing plans, with its shareholders able to be offered the “opportunity to benefit from capital increase” which would be KTM’s lifeline of sorts.
Unfortunately, reports say that KTM only wanted to raise capital by itself and leave out companies trying to help them navigate in rough waters such as Whitebox. KTM is set to present its restructuring plan on February 25.
