Yesterday, Pierer Mobility AG, the parent company of KTM notified that it has received several offers from investors as part of the investor process structured by Citigroup Global Markets Europe AG.
Understandably, the investors have not been revealed as discussions are ongoing. However, the media had speculated that the investors may be India-based Bajaj Auto and China-based CF Moto, both of whom have long-term partnerships with KTM. China-based investment group FountainVest may be another suitor.
However, most importantly, Pierer says that the finances offered would finance only 30 percent of the restructuring requirements of KTM AG. That's not very encouraging, and these investors are FIs offering debt.
Impact
This is a developing story from last year, and we expect many more months of upheaval before the issue settles down. In some ways, KTM is too big to fail as it is interconnected to so many other industrial entities within Europe and outside. Bajaj and/or CF Moto will have to step in to save Pierer Mobility, but they would like to do things on their terms.
We have been extensively covering the issue in our previous posts.
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