Business News
E.C.H. Will, Kugler-Womako and Papersystems Holding file application for protective shield proceedings
Monday 08. July 2013 - · Self-administration ordered - executive management remains in place
· Restructuring expert Detlef Specovius joins management
· Lawyer and tax consultant Berthold Brinkmann appointed as preliminary trustee
· In spite of positive business and earnings Kugler-Womako had to file for protective shield proceedings as well
· Business of all companies will remain fully operational
· Pemco Inc. in Sheboygan/WI not affected
The Executive Management Board of Papersystems Holding GmbH filed for protective shield proceedings, a German version of the US Chapter 11 proceedings, on 28 June 2013 after consultation with its shareholders at the Pinneberg district court, as did the affiliate companies E.C.H. Will GmbH and Kugler-Womako GmbH. These proceedings allow a company to create a sustainable business plan with the goal of restructuring the business while maintaining self-administration. This will create the necessary conditions for the company to successfully continue its business in the future.
For this reason, the Management Board will continue to be responsible for all three companies. Detlef Specovius has joined the management as a restructuring expert. The district court has appointed the lawyer and tax consultant Berthold Brinkmann from the Hamburg-based firm Brinkmann & Partner to preside over the procedure as a preliminary trustee.
In the coming months, a new concept with the objective to restructure the company will be implemented. This concept has already been pre-agreed with the staff, the works’ council and trade union. Alexander Wassermann, CEO of E.C.H. Will holding company Papersystems, explains: “Our objective is to use the benefits of the protective shield proceedings and the support of our shareholders to emerge from this situation as quickly and as successfully as possible. We are convinced that
Papersystems and its affiliates E.C.H. Will and Kugler-Womako can be restructured in a very short period for a solid, long-term future.”
Background: While the group’s service business is continually growing, from mid-2012 on there has been a drastic slump in the new machine business of E.C.H. Will reflecting the global stagnation in the graphic paper market and the economic slow-down in Asia. As the world market leader of passport binding and paper converting machines, Kugler-Womako is financially healthy and profitable and enjoys a positive business trend. Due to a pooled financing model, Kugler-Womako is unwillingly forced to file for protection under the shield. This is not the case for Papersystems’ third subsidiary – the US based Pemco Inc. in Sheboygan/WI: this company is profitable, financially independent and therefore not affected by these proceedings.
The business of all companies will remain fully operational. Customers and suppliers have been informed. Payment of wages and salaries during the proceedings are ensured.
Since 1866, for nearly 150 years, E.C.H. Will has been a leading provider of machines and system solutions for the paper manufacturing and processing industry. E.C.H. Will has 239 employees in Wedel (Germany), Kugler-Womako 105 in Nürtingen (Germany) and Pemco 139 in Sheboygan/WI. In 2012, a consolidated revenue of approx. 111 million (144 million US $) was achieved.