Bajaj raised a Rs 5,431 crore loan ($632 million) to save KTM. The Austrian bikemaker has been in the middle of a financial crisis, and after a victorious court hearing that helped pay off most of its debts, the brand still faced difficulties settling its creditors’ dues. This is where Bajaj comes to save the day.
Bajaj to the Rescue! Secures a loan for KTM
Fortunately, the Pune based Manufacturer’s international subsidiary, Bajaj Auto International Holdings, raised a loan to financially support KTM, in which it holds a 49.9% stake, just a day before the due date. With KTM facing a critical deadline of 23 May to save itself from potentially going bankrupt, Bajaj stepped in with a 1-year unsecured loan sourced from DBS Bank, JP Morgan Chase and Citigroup Global Markets. The funds will reportedly help the Austrian Marquee manage liquidity, sustain product development and improve its production and supply chain.
A few weeks ago, most of KTM’s debt was written off, but the company still had to secure 544 million euros by 23 May to secure its future.
KTM filed for Bankruptcy last year
In November 2024, KTM filed for Bankruptcy after the acquisition of MV Agusta and investing a substantial amount into MotoGP. The financial problems were further elevated by the decline in 2-wheeler sales in Europe. The brand cut costs on some of its motorsport divisions, including the Dakar Rally, racing with the KTM brand alone, leaving Gas Gas and Husqvarna out this season.
This move ensures KTM’s operations continue without any Hiccups. Furthermore, it also strengthens Bajaj’s strategic position globally, especially as both brands co-develop and launch new motorcycles for India and export markets. Following the loan, Bajaj’s shares saw a 1.91% increase, trading at Rs 8,487.15.
KTM is one of the most favourite brands among youngsters in India, but it is facing difficulty in sales worldwide with huge stock of unsold motorcycles for all its 3 brands (KTM, Husqvarna, Gas Gas) despite offering value-for-money performance motorcycles. Due to the financial crisis, its production stopped on April 28, which was caused by a scarcity of crucial parts required to keep up production. With Bajaj saving KTM this time, the latter will start its restructuring procedures soon.
Bajaj and KTM both have yet to give an official statement on this matter.
