Hess files for insolvency
19 February 2013 09.00 GMT
(Germany) - Statement confirms that German lighting company has gone into administration.
Hess has filed for insolvency after making its stock market debut in October. The German street light maker's shares has fallen from 15.5 euros, the company's IPO price in October, to 0.76 euro. Small investors and financial institutions had invested 36 million euros ($48.47 million) in the flotation in late October.
The sole member of the management board of Hess AG, Mr. Till Becker, filed, as required by law, an application for the opening of insolvency proceedings over the assets of Hess AG with the competent local court of Villingen.
“Despite of pursing of all alternatives, we were required to file for insolvency because the illiquidity both with regard of Hess AG and Hess Lichttechnik GmbH,” Becker says. “Our objective is now to restructure Hess with the instruments of the Insolvency Code and to make the company substantially fit for the market.”
An online statement on the Hess website said: “After intensive examinations, the management board came to the conclusion that Hess AG is illiquid, has no positive prognosis of the continuation of the enterprise and the company is, according to the current status of examinations, over-indebted. The management board will, as a result, file an application for insolvency with the competent local court (insolvency court). As well, the management of Hess Lichttechnik GmbH, a 100 per cent subsidiary of Hess AG, will file an application for insolvency because of illiquidity.
“Hess AG is illiquid. The available moneys of Hess AG are not sufficient to meet the mature obligations to pay of Hess AG. One of the main reasons for illiquidity is that the major stockholder, Hess Grundstücksverwaltungs GmbH & Co. KG, does not fulfill due (in the view of Hess AG) obligations vis-à-vis the Hess group and is not willing to make sufficient contributions for the restructuring of the company.
Because of negative cash flows (before financing) oft he company since 2009 the financing of the enterprise of the company for the current and next fiscal year is not secured. Because of uncertainties with regard to possible suits of investors there are no sufficient chances for acquisition of new equity or debt capital from investors. As a result, there is a negative positive prognosis of the continuation of the enterprise with regard to the company.”
No further comment could be obtained from Hess.