Prepress
EAE Group initiates creditor protection proceedings
Monday 09. September 2013 - Company to continue operations - Employees' salaries are protected - Core business is profitable - investor interest secured
Last Friday, the EAE Group, Ahrensburg, submitted an application to the District Court of Reinbek to initiate creditor protection proceedings under its own administration. The Court has approved the continuation of operations by Managing Director Werner Ringel. Peter-Alexander Borchardt of Reimer Rechtsanwälte Partnergesellschaft, Hamburg, has been appointed provisional administrator.
EAE is the leading supplier of control systems and automation and software solutions for newspaper printing plants. Worldwide, around 550 printing plants use EAE solutions. The Group is based in Ahrensburg (near Hamburg) and has two other sites. It employs around 270 people.
Business operations will continue without restriction at all company locations. In a staff meeting today, Managing Director Werner Ringel explained to the workforce that their employment contracts will initially remain unaffected by the creditor protection proceedings.
Realignment and cost reduction
As early as 2009 a PriceWaterhouseCoopers report recommended that the EAE Group be comprehensively restructured. Banks, shareholders and the Supervisory Board installed Werner Ringel, considered to be an experienced restructuring manager. “We have a clear perspective”, says Werner Ringel. “Our goal is the sale of a profitable business which is secure long into the future. To this end we have launched a far-reaching restructuring process.”
EAE has revamped its entire product range and introduced two new product lines. Direct-sales of modernization solutions for existing rotary printing plants have been expanded. Fast-growing business areas, such as gravure and flexographic printing for the packaging industry, are already being overhauled. Sales offices in India and South America have been opened to serve the local markets there.
Positive effects of the realignment
Over the past three years, this strategic realignment has already generated significant positive results for the company – contrary to the industry trend as a whole. During this time debt has been reduced from 16 million euros to 8 million euros.
The aim of all the measures has been to make the company ready for selling. “Unfortunately, sales in the prevailing conditions could not be realized as quickly as was needed to increase the capital base”, explains Ringel.
Ensuring sound prospects
The current situation is partly due to prior debts. In August, the necessary long-term extension of the existing credit line was refused. “In my role as Managing Director I have now had to initiate creditor protection proceedings”, says Werner Ringel. “This will allow us three months in which to draw up a plan for the final restructuring phase and to rapidly complete the process. We see this tool as a great opportunity to complete the last stage in our restructuring, which has already been successful.”
Ongoing negotiations
Currently, intensive negotiations are taking place with the involved banks and investors. There are interested parties who want to invest in the company at short notice.
On 30 August 2013, the following companies submitted applications to initiate creditor protection proceedings under their own administration.
EAE Ewert Holding GmbH, Ahrensburg
EAE Ewert Ahrensburg Electronic GmbH, Ahrensburg
EAE Ewert Automation Electronic GmbH, Coswig.