KTM, the Austrian motorcycle manufacturer, has secured a €550 million refinancing loan from a consortium of international banks, the Bajaj Mobility Group announced Thursday. The financing replaces a €450 million loan provided by Bajaj Auto International Holdings B.V. In May 2025 as part of a restructuring plan, effectively solidifying KTM’s financial footing and reducing its reliance on intra-group funding.
The five-year loan, which carries an interest rate in the low to mid-single-digit percentage range, is unsecured, according to a statement from Bajaj Mobility, formerly known as Pierer Mobility. The agreement also includes standard market restrictions on dividend distributions during the loan’s tenure. This refinancing marks the completion of KTM’s capital realignment linked to last year’s restructuring efforts, a period of significant change for the company.
Restructuring and Cost-Cutting Measures
The refinancing comes as KTM continues to streamline its operations. In January 2026, the company announced plans to reduce its workforce by approximately 500 employees as part of an efficiency program aimed at lowering costs and simplifying its business. As of December 31, 2025, KTM’s headcount stood at 3,794, a decrease from 5,310 the previous year, reflecting these ongoing efforts.
Beyond workforce reductions, KTM has been actively divesting non-core assets. These include the sale of FELT Bicycles, the termination of its distribution agreement with CFMOTO, and the divestment of stakes in MV Agusta and X-Bow. The company is now focused solely on its core motorcycle brands: KTM, GASGAS, and Husqvarna. This strategic refocusing is intended to sharpen KTM’s competitive edge and improve profitability.
Financial Performance and Bajaj’s Role
The require for restructuring and refinancing comes after a challenging financial year for KTM. In fiscal year 2025, the company reported consolidated sales of just over €1 billion, a 46% year-over-year decline. The new financing is expected to provide stability and allow KTM to execute its long-term strategy.
Bajaj Auto’s involvement has been crucial throughout this process. In November 2025, Bajaj Auto completed the acquisition of a controlling stake in KTM AG, further cementing the partnership between the two companies. The initial €450 million loan from Bajaj Auto International Holdings B.V. Provided a critical lifeline during the restructuring phase, and the subsequent refinancing demonstrates renewed confidence from the broader financial market. ET Auto reported on the details of the refinancing agreement.
Impact on Dividend Payments
The terms of the €550 million loan include restrictions on dividend distributions, a common condition for companies undergoing financial restructuring. So that KTM will likely prioritize debt repayment and reinvestment in the business over returning capital to shareholders in the short term. This measure is designed to ensure the company’s financial stability and support its long-term growth objectives.
The successful completion of the refinancing process signals improved access to global capital markets for KTM following its restructuring. Autocar Pro detailed the terms of the loan and its implications for KTM’s financial future.
Looking ahead, KTM will focus on executing its restructuring plan, improving operational efficiency, and strengthening its core brands. The company is expected to provide further updates on its progress during its next earnings call. Investors and industry observers will be closely watching KTM’s performance in the coming months to assess the effectiveness of its turnaround strategy.
Disclaimer: This article provides information for general knowledge and informational purposes only, and does not constitute financial advice.
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