US Hedge Fund Whitebox Seeks Allies to Boost KTM Creditor Payout

A US hedge fund is asking fellow creditors of the insolvent motorcycle maker KTM AG to join forces and push for a restructuring plan that offers higher payments than the company’s proposal.

An investor group led by Whitebox Advisors LLC calculates creditors could recover at least 45% of their claims under its proposal, pitched to more than 100 holders of KTM’s promissory notes on a conference call Tuesday, according to people familiar with the matter who asked not to be named.

That’s more than the 30% currently offered by KTM, the minimum recovery required by Austrian law in a self-administered ...