Hessplastics: New exhibition in insolvency proceedings-structured investor process initiated

Founded in 1950, the company employs about 290 people. Hessplastics develops and produces plastic solutions to customers in the automotive, electronics and domestic appliance sectors. The range of services includes the research of prototypes made of plastic and metal, specialized plastic injection molding processes and tool making.

The provisional insolvency administrator and his team are currently examining the economic situation and are working together with the regulation to stabilize the company. According to the parties involved, the financing of ongoing business operations to the coming months is secured. The wages and salaries of the employees are initially covered by the insolvency money.

Immediately after the appointment of the provisional insolvency administrator, the workforce was informed of the situation and the further procedural steps at a works meeting. Talks with customers, suppliers and other business partners were started in order to secure the continuation of operations and to create the conditions to a renovation.

The company cites the ongoing weakness of the automotive sector as the main result in of the economic difficulties. Hessplastics generates around three quarters of its sales from customers in this sector. Declining production figures and reduce demand volumes have led to significant sales losses in recent months. At the same time, increased energy and raw material costs weighed on the company. In particular, the energy-intensive manufacturing processes in plastic injection molding increased cost pressure.

The regulation had already initiated restructuring measures before filing to insolvency. This included the relocation and downsizing of the administrative headquarters, personnel measures, further cost reductions and a stronger levels on the core technological areas. In addition, unprofitable projects were ended and the product portfolio was adjusted. According to the company, while these measures led to improvements, they did not sufficiently compensate to the consequences of the ongoing market strains.

In the further course of the preliminary insolvency proceedings, a structured investor process is to begin at short notice. to this purpose, the commissioning of an M & A consulting company specializing in corporate transactions is planned. The aim is to take over the company by an investor who enables further financing and prolonged continuation at the Neunkirchen location. According to the preliminary insolvency administrator, initial discussions with possible interested parties are already underway.

The basis to a possible continuation is the existing production capacities, research and manufacturing expertise, customer relationships and the qualified workforce. The investor process should be initiated rapidly. So far, no further details are available about the further course of the insolvency proceedings and possible restructuring solutions.