KTM to file for Bankruptcy/ Self Restructuring on Friday

Hammer 663s
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11/26/2024 9:50am
For those asking about stocks.  I thought about writing up some things. But this sums it up pretty well. "If a company declares Chapter 11 bankruptcy, it...

For those asking about stocks.  I thought about writing up some things. But this sums it up pretty well.

 

"If a company declares Chapter 11 bankruptcy, it is asking for a chance to reorganize and recover. If the company survives, your shares may, too, or the company may cancel existing shares, making yours worthless.

If the company declares Chapter 7, the company is dead, and so are your shares.

Owners of common stock often get nothing when a company enters liquidation since they are last in line for payment."

PMG/KTM is Austrian. None of that applies at all. There are entirely different rules there. I've seen no-one here post anything where they have expertise in...

PMG/KTM is Austrian. None of that applies at all. There are entirely different rules there. I've seen no-one here post anything where they have expertise in EU/Austrian bankruptcy law.

Where are they traded?  In Australia or US stock market?  Honestly never looked into it. 

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough it is to buy/sell with any speed. I'll stick with catching falling knives on the NASDAQ or Dow. Wink  

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2
11/26/2024 9:53am

If I owned a KTM, should I be worried about spare parts availability?

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NV825
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11/26/2024 9:53am

KTM/Husky/GG Riders: What the hell are these?

Pit: 

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Justthefacts
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11/26/2024 9:54am Edited Date/Time 11/26/2024 9:59am
PMG/KTM is Austrian. None of that applies at all. There are entirely different rules there. I've seen no-one here post anything where they have expertise in...

PMG/KTM is Austrian. None of that applies at all. There are entirely different rules there. I've seen no-one here post anything where they have expertise in EU/Austrian bankruptcy law.

Where are they traded?  In Australia or US stock market?  Honestly never looked into it. 

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough...

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough it is to buy/sell with any speed. I'll stick with catching falling knives on the NASDAQ or Dow. Wink  

Ok thanks for the clarification 👍

I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention. Lost $ and vowed to never do that again. I was at the time licensed in 6 and 66, so I knew the risk.  But hoped for the once in a lifetime win. Companies this small, seems like even less of a chance, for those thinking about buying.

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The Shop

11/26/2024 10:01am
For those asking about stocks.  I thought about writing up some things. But this sums it up pretty well. "If a company declares Chapter 11 bankruptcy, it...

For those asking about stocks.  I thought about writing up some things. But this sums it up pretty well.

 

"If a company declares Chapter 11 bankruptcy, it is asking for a chance to reorganize and recover. If the company survives, your shares may, too, or the company may cancel existing shares, making yours worthless.

If the company declares Chapter 7, the company is dead, and so are your shares.

Owners of common stock often get nothing when a company enters liquidation since they are last in line for payment."

Those are the facts for US based stocks, but Hammer is right. Those are not the facts for EU companies. 

They play by different rules (and facts) of which I don't have any knowledge on...We need facts about EU listed stock.

 

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Justthefacts
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11/26/2024 10:03am

I'd like to know who down votes posts that seem like they have no real opinion etc?  Seems weird to me. Just sayin. 

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soggy
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11/26/2024 10:03am

Where are they traded?  In Australia or US stock market?  Honestly never looked into it. 

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough...

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough it is to buy/sell with any speed. I'll stick with catching falling knives on the NASDAQ or Dow. Wink  

Ok thanks for the clarification 👍I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention...

Ok thanks for the clarification 👍

I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention. Lost $ and vowed to never do that again. I was at the time licensed in 6 and 66, so I knew the risk.  But hoped for the once in a lifetime win. Companies this small, seems like even less of a chance, for those thinking about buying.

I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on an upswing considering how far it has fell. But they need to get on stable footing first. 

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Hammer 663s
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11/26/2024 10:07am

Where are they traded?  In Australia or US stock market?  Honestly never looked into it. 

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough...

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough it is to buy/sell with any speed. I'll stick with catching falling knives on the NASDAQ or Dow. Wink  

Ok thanks for the clarification 👍I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention...

Ok thanks for the clarification 👍

I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention. Lost $ and vowed to never do that again. I was at the time licensed in 6 and 66, so I knew the risk.  But hoped for the once in a lifetime win. Companies this small, seems like even less of a chance, for those thinking about buying.

Yeah and given the fact that it's an Austrian/Chinese company, listed on the Swiss exchange, and declaring bankruptcy under EU law, the risk massively multiplies for us. 

I did Supermicro 10 days ago at $17.50 and sold yesterday at $38. Made enough to rent gear for a week to rebuild my track. Rolled the dice, got lucky. YMMV. Smile

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Justthefacts
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11/26/2024 10:08am Edited Date/Time 11/26/2024 10:11am
Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough...

Pretty sure on the Swiss exchange. It's not a simple stock to buy for US investors. I considered a buy until I found out how tough it is to buy/sell with any speed. I'll stick with catching falling knives on the NASDAQ or Dow. Wink  

Ok thanks for the clarification 👍I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention...

Ok thanks for the clarification 👍

I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention. Lost $ and vowed to never do that again. I was at the time licensed in 6 and 66, so I knew the risk.  But hoped for the once in a lifetime win. Companies this small, seems like even less of a chance, for those thinking about buying.

soggy wrote:
I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on...

I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on an upswing considering how far it has fell. But they need to get on stable footing first. 

I'd be more interested in buying off parts like gasgas.  Maybe make a deal on something like a 2022 frame and maybe other older things that would be a good base line start point. Get ev bicycles too.  I feel like there is potential in some things, instead of just going so big like they did. 

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Larry450
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11/26/2024 10:13am
1000010394
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11/26/2024 10:14am
yak651 wrote:

Roger is going to have to work another 20 years to retire when his stock options are at $0

Maybe Rog will get laid off🤷‍♂️

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soggy
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11/26/2024 10:38am
Ok thanks for the clarification 👍I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention...

Ok thanks for the clarification 👍

I bought worldcom penny stocks thinking it might come out of it since it was so big.  Thought maybe govt intervention. Lost $ and vowed to never do that again. I was at the time licensed in 6 and 66, so I knew the risk.  But hoped for the once in a lifetime win. Companies this small, seems like even less of a chance, for those thinking about buying.

soggy wrote:
I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on...

I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on an upswing considering how far it has fell. But they need to get on stable footing first. 

I'd be more interested in buying off parts like gasgas.  Maybe make a deal on something like a 2022 frame and maybe other older things that...

I'd be more interested in buying off parts like gasgas.  Maybe make a deal on something like a 2022 frame and maybe other older things that would be a good base line start point. Get ev bicycles too.  I feel like there is potential in some things, instead of just going so big like they did. 

I think part of the problem is the aux brands they have don't really hold value on their own.  Who's going to pay much for the name Gas Gas? Cause that's all your buying.. ok maybe you can get the previous model from them to sell fort a few years, who's going to want to buy that?  then you've got to come up with your own design.  Not sure if its true but someone said KTM was still paying royalties on the Husky name.  

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11/26/2024 10:42am Edited Date/Time 11/26/2024 10:43am
soggy wrote:
I think part of the problem is the aux brands they have don't really hold value on their own.  Who's going to pay much for the...

I think part of the problem is the aux brands they have don't really hold value on their own.  Who's going to pay much for the name Gas Gas? Cause that's all your buying.. ok maybe you can get the previous model from them to sell fort a few years, who's going to want to buy that?  then you've got to come up with your own design.  Not sure if its true but someone said KTM was still paying royalties on the Husky name.  

Rights to previous Gas Gas off road models were already sold to Rieju.

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Xeno
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11/26/2024 10:44am

Probably some nervous sports agents this morning. This sucks, I'm friends with some of those guys.

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1
crt32
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11/26/2024 10:50am

Per ChatGPT

U.S. Bankruptcy Protection

Legal Framework: Governed by federal law, primarily the U.S. Bankruptcy Code.

Common Procedures:

Chapter 11: Allows companies to restructure their debts and continue operations while developing a reorganization plan. Often used by larger companies.

Chapter 7: Involves liquidation, where a company ceases operations and its assets are sold to pay creditors.

Court Involvement: Bankruptcy proceedings are centralized under specialized bankruptcy courts, which have extensive oversight of the process.

Creditor Hierarchy: Creditors are prioritized:

Secured creditors (e.g., those with collateral).

Unsecured creditors.

Equity holders (e.g., shareholders).

Automatic Stay: Filing for bankruptcy triggers an automatic stay, halting most creditor actions like lawsuits or foreclosures.

Debtor-in-Possession (DIP): In Chapter 11, the debtor often retains control of operations while restructuring under court supervision.

EU Bankruptcy Protection

Legal Framework: Bankruptcy laws vary by country but are influenced by EU directives, such as the EU Restructuring and Insolvency Directive (2019/1023). The Directive promotes early intervention and restructuring.

Common Procedures:

Preventive Restructuring Frameworks: Allows companies to restructure debts without full insolvency proceedings.

Liquidation Proceedings: For companies deemed unsalvageable, assets are liquidated to repay creditors.

National Variances: Each EU country has its own insolvency laws (e.g., the UK’s Administration, Germany’s Insolvency Code, France’s Redressement Judiciaire).

Court Involvement: Less centralized than in the U.S.; local courts play a role, but procedures aim to minimize full-blown court intervention.

Creditor Hierarchy: Similar to the U.S., with secured creditors generally prioritized.

Automatic Stay: EU laws encourage the use of an automatic stay during restructuring but with specific time limits (usually up to 4 months).

Role of Management: In some systems (e.g., France), management retains significant control; in others (e.g., Germany), an administrator may take over.

Key Differences

Uniformity: U.S. bankruptcy is more uniform across states, while EU laws vary significantly by country.

Debtor Control: U.S. Chapter 11 offers significant control to the debtor, whereas EU systems may assign administrators to manage the process.

Focus on Restructuring: EU laws, especially post-Directive, prioritize early intervention and avoiding liquidation. The U.S. also emphasizes restructuring but offers liquidation options under Chapter 7.

Speed: EU proceedings often aim for quicker resolutions compared to the sometimes lengthy Chapter 11 processes in the U.S

Justthefacts
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11/26/2024 10:53am
soggy wrote:
I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on...

I would be waiting at least 6-12 months and seeing what happens here before considering an investment. There is plenty of opportunity to grab it on an upswing considering how far it has fell. But they need to get on stable footing first. 

I'd be more interested in buying off parts like gasgas.  Maybe make a deal on something like a 2022 frame and maybe other older things that...

I'd be more interested in buying off parts like gasgas.  Maybe make a deal on something like a 2022 frame and maybe other older things that would be a good base line start point. Get ev bicycles too.  I feel like there is potential in some things, instead of just going so big like they did. 

soggy wrote:
I think part of the problem is the aux brands they have don't really hold value on their own.  Who's going to pay much for the...

I think part of the problem is the aux brands they have don't really hold value on their own.  Who's going to pay much for the name Gas Gas? Cause that's all your buying.. ok maybe you can get the previous model from them to sell fort a few years, who's going to want to buy that?  then you've got to come up with your own design.  Not sure if its true but someone said KTM was still paying royalties on the Husky name.  

For instance, I'd personally like to have their 2022 version of 2 strokes and their ev bicycles.  I have an engine design, and feel that the frame doesn't have to be updated as much as all these companies do.  Find a great year and then work on suspension and engine.  What if suspension was made by Fox? Or another out of the box company. We have grown up with specific companies that rule over everything.  But does that mean they're the best that could be?  I'm probably just going to start with the motor only, but it would be cool to start above 0.  Even if it's starting at 1 or 2 out of 10.  It's above 0. 

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11/26/2024 11:01am
Pop Shmoke wrote:
Hearing now that the lawrences are having a hard time with the frame on the new crf and seeing how basically everyone hates the new ktm...

Hearing now that the lawrences are having a hard time with the frame on the new crf and seeing how basically everyone hates the new ktm… it brings back up the same question Ive had forever. Why do these companies always feel the need to make massive changes to platforms that are working great? Before the most recent redesign ktm had been doing years and years of smart refinement to the platform. Every year they were tweaking a little here, shaving a little there, adjusting a couple mm here. Then when all of it has really truly paid off and their bike is at absolute peak form they tear up everything, throw it in the trash, and introduce a whole new frame. 

It seems like these brands are changing things just to say they changed things. Its biting them in the ass though. Keefer just showed a few months ago that most ppl actually like the 07 crf the best. Maybe they should only be changing the things that need to be changed like making more power. If the public demands a refresh they can always redesign the plastics. Think of how much it costs ktm to redesign everything for the new bike. They have to change the entire production line. All of that money lost to end up with a worse bike. Maybe just like the phone upgrade yearly cycle no longer makes sense the needing the brands to completely change everything every few years makes no sense. This obviously isnt the reason why ktm is going bankrupt, but theyre going to have to fix a lot of problems and the production line is definitely going to be a part of that. 

then you get the reputation suzuki has

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Justthefacts
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11/26/2024 11:03am
Pop Shmoke wrote:
Hearing now that the lawrences are having a hard time with the frame on the new crf and seeing how basically everyone hates the new ktm...

Hearing now that the lawrences are having a hard time with the frame on the new crf and seeing how basically everyone hates the new ktm… it brings back up the same question Ive had forever. Why do these companies always feel the need to make massive changes to platforms that are working great? Before the most recent redesign ktm had been doing years and years of smart refinement to the platform. Every year they were tweaking a little here, shaving a little there, adjusting a couple mm here. Then when all of it has really truly paid off and their bike is at absolute peak form they tear up everything, throw it in the trash, and introduce a whole new frame. 

It seems like these brands are changing things just to say they changed things. Its biting them in the ass though. Keefer just showed a few months ago that most ppl actually like the 07 crf the best. Maybe they should only be changing the things that need to be changed like making more power. If the public demands a refresh they can always redesign the plastics. Think of how much it costs ktm to redesign everything for the new bike. They have to change the entire production line. All of that money lost to end up with a worse bike. Maybe just like the phone upgrade yearly cycle no longer makes sense the needing the brands to completely change everything every few years makes no sense. This obviously isnt the reason why ktm is going bankrupt, but theyre going to have to fix a lot of problems and the production line is definitely going to be a part of that. 

hotlasagna wrote:

then you get the reputation suzuki has

I disagree in some ways. Suzuki has not even updated a starter. Had they kept the same frame and updated engine and suspension, they'd be thought of differently. Jmho

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soyMotero
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11/26/2024 11:08am
Screenshot 20241126-200404 ChromeScreenshot 20241126-200428 Chrome.jpg?VersionId=7kc

 

No more questions your honor...

 

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twotwosix
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11/26/2024 11:08am
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endurox
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11/26/2024 11:12am
Nairb#70 wrote:

What are the implications for the current dealer network, aside from the obvious?

Dealers are always the last to know

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MxAddic
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11/26/2024 11:27am

"Its parent, Pierer Industrie AG, asked creditors on Monday to extend the maturity of almost €250 million ($262 million) in debt."

So now we know it's high 3 digit mil (likely a low estimate) needed at PKTM and it's 37% owner needs 250 mil.

1.5 bil current debt plus about another 1.5 bil to keep it going. No way to pay it back. That's why they can't get funding.

soggy
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11/26/2024 11:36am
I disagree in some ways. Suzuki has not even updated a starter. Had they kept the same frame and updated engine and suspension, they'd be thought...

I disagree in some ways. Suzuki has not even updated a starter. Had they kept the same frame and updated engine and suspension, they'd be thought of differently. Jmho

The starter is just the low hanging fruit. It’s the lack of development on an engi e that was introduced in 2009 that really hasn’t changed.  The suspension is fine outside of being way oversprung, it’s not like it needs to be replaced like some riders with the wp air stuff. People want development, there will always be a prevailing thought that things could be better and existing models get stale and that’s why we see new models introduced.

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Beagle
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11/26/2024 11:46am

Fun fact: in 1991 KTM went bankrupt, in 1992 a guy named Pierer bought it for 3.5 million euros.

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mvd61
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11/26/2024 11:49am

Hopefully soggy and mxaddic use protection…

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soggy
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11/26/2024 11:50am
mvd61 wrote:

Hopefully soggy and mxaddic use protection…

😂😂

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1
11/26/2024 11:55am

Someone predicted it, when they were building their new Head Quarters.

Spoiler: i bought a 2024 GasGas for almost half it’s price 1 month ago.

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11/26/2024 11:57am Edited Date/Time 11/26/2024 11:58am

If I owned a KTM, should I be worried about spare parts availability?

No. First the company is restructuring its debt (and equity) so it can continue operating in the future. This is actually good news (assuming the restructuring plan is approved)  its the first step in moving forward. Second, spares are revenue producing which they'll want. 

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