The case of Fanatec (Endor AG) is not unique, as many companies turn to these new tools to find new investors and restructure the company when they face tough times. Recaro and BBS are following in the footsteps of Endor AG by taking advantage of these German legal mechanisms.
Recaro Automotive GmbH
Recaro Automotive GmbH, based in Kirchheim unter Teck, has filed for insolvency with the Local Court of Esslingen. The company faced significant financial difficulties due to extreme price increases in recent crisis years and the loss of an important contract. The legacy products and business operations impacted the development of new product offerings during a regional downturn in vehicle purchase spending. On July 29, 2024, the court approved preliminary self-administration and appointed lawyer Holger Blümle from the law firm Schultze & Braun as provisional administrator. The international consulting firm Baker Tilly is providing legal advice throughout the process.
Insolvency payments will secure employee wages. Employees were informed on Tuesday morning at a general meeting along with the union, the works council, and local politicians. The company plans to maintain full production during the insolvency proceedings to continue fulfilling all existing orders and new customer inquiries. Shareholders have emphasized the importance of the organization in the region for the group and have pledged their support for restructuring efforts.
The insolvency proceedings are limited to Recaro Automotive GmbH and do not affect any other companies within the group. The financially distressed traditional Swabian company intends to strengthen its position both locally and globally through this process, under judicial supervision and with the support of Baker Tilly.
Working together as a team with our employees, suppliers, and customers through the possibility of an insolvency plan under German law, we hope to be on solid ground again in a timely manner.
BBS Automotive GmbH
According to a report, the popular wheel manufacturer BBS has filed for insolvency in a local German court. However, this is not the first time BBS has declared insolvency; it is the fifth. The company had previously announced its insolvency in 2007, 2010, 2020, and 2023.
ISH Management Services, which acquired BBS Automotive GmbH in June, stated: “We will never let down the people who have walked this path with us. We will never give up on the BBS brand, which we believe is one of the most important global German brands. We have a plan, and we are determined to implement it.”
The news surprised some of BBS’s overseas delegations. While BBS Automotive GmbH filed for insolvency in Germany, its operations in the United States continue as normal, as they are under different ownership. Craig Donnelly, president of BBS America, stated: “We are independent of that entire situation. But it’s a bad situation for everyone in general, because we don’t know what is going to happen at this point.”
BBS Japan also mentioned that it has no shareholding relationship with BBS Germany. They also clarified that BBS Motorsports, a German manufacturer of racing wheels, is a 100% subsidiary of BBS Japan and a completely separate entity from BBS Germany. Additionally, BBS Japan owns the ‘BBS’ trademark for forged wheels, so the bankruptcy of BBS Germany has “little” impact.
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