Following cost-cutting measures: 75-year-old traditional trade company faces insolvency
In a significant move to regain financial stability, the 75-year-old German trading company, Dresselhaus GmbH & Co. KG, has filed for insolvency under self-administration. The company, known for its extensive presence in the C-parts market (screws and nuts), has been grappling with structural financial problems for some time, as indicated by review platforms [1].
The insolvency filing was primarily due to underlying financial issues, despite a profitable 2023 that saw the company generate a turnover of over 20 million euros, largely from the sale of four properties [2]. Without these one-time sales, the company would have ended the year with losses. Efforts to stabilize and restructure were initiated but could not be completed in the required timeframe due to insufficient funds [1].
The Local Court of Bielefeld has approved insolvency in self-administration for Dresselhaus, allowing the management to continue operating while implementing a court-approved restructuring plan. This plan focuses on sustainable economic and structural realignment, with the aim of preserving the company’s future by exploring all restructuring options in a structured and expedited way, while protecting creditors’ interests [2]. Legal and restructuring experts, including Marc-Philippe Hornung and Dr. Thomas Rieger, have been appointed to support the management team, led by Markus Schörg [2].
The insolvency proceedings have left the company's approximately 600 employees uncertain about their future. Business operations are continuing without restrictions during the insolvency proceedings, but the long-term effects on employment depend on the success of the restructuring plan in restoring financial stability and operational efficiency [1].
This strategic move reflects a commitment to a structured transformation process, maintaining operational continuity, and safeguarding stakeholder interests. However, financial difficulties in recent months have had a greater impact on the employees than the management may have admitted [3]. Late wage payments and a poor working atmosphere are among the issues indicated on review platforms [4].
Branches of Dresselhaus are located in Germany, as well as in Russia, Italy, Austria, and Turkey [5]. At this time, there is no public information regarding potential buyers or investors for the company.
References:
[1] [Local News Outlet] (URL) [2] [Business News Outlet] (URL) [3] [Employee Review Platform] (URL) [4] [Industry Review Platform] (URL) [5] [Company Website] (URL)
The insolvency filing was a result of long-standing financial issues within the company, despite a profitable year in 2023. Efforts to stabilize and restructure the business were initiated but could not be completed in time due to insufficient funds. The Local Court of Bielefeld has approved the insolvency in self-administration, which allows the management to continue operating while implementing a restructuring plan in the finance industry, aiming to preserve the company’s future by exploring all options in a structured and efficient manner, while protecting creditors’ interests.
