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Trevira Reorganizing in Insolvency, Seeking New Owner

Less than a month after announcing a management overhaul, polyester fiber giant Trevira GmbH is restructuring its business under an insolvency procedure in the local Augsburg court.

"Customer orders will be carried out completely, deliveries executed after the insolvency announcement will be fully paid. The employees' wages and salaries are secured by the insolvency payments for a period of three months. Working contracts will continue to be valid during the period of the preliminary insolvency procedure," the company said in a statement.

Insolvency expert Werner Schneider has been appointed preliminary insolvency manager by the court.

India's Reliance Group, Trevira's owner, "has committed themselves to pay in full the outstanding bank liabilities of 55 million Euro [about $78 million US] for Trevira GmbH.

Trevira will enter the insolvency procedure without having bank liabilities. This will further increase the chances of a successful restructuring," said Trevira managing director Elke Bäuerle.

Bäuerle, a restructuring expert, was appointed to her post May 13.

"The crucial question we have to answer is: where do we earn money and where do we lose money?" she said. "Trevira has good products and is basically competitive."

Reliance plans to sell the company, she said.

Trevira had 2008 sales of around 323 million Euros, or approximately $458 million US. The company operates production facilities in Belgium, Denmark, Germany and Poland and employs about 1,800 people.

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