German brewer Eichbaum is to cease operations, the company’s MDs and its court-appointed trustee have announced.
In a statement on behalf of the business, it was said a “comprehensive review” of the loss-making brewer’s options had shown it could not continue.
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Eichbaum, founded in 1679 and based in Mannheim in south-west Germany, filed for “self-administration” in October in order to restructure the business.
At the time, Eichbaum pointed to macroeconomic factors including “unstable geopolitical conditions and increasingly unpredictable tariff policies in key sales markets”, as well as “intense” competition within beer and a tough hospitality market.
The company said then its ambition was “to evolve from a pure brewer into a beverage manufacturer”.
In March this year, Eichbaum announced a “continuation plan” had been approved by its creditors, with an investor lined up to acquire the brand and production facilities as part of “an asset deal”.
However, Eichbaum’s trustee and its senior directors have concluded the company could not carry on.
According to Monday’s (13 July) statement, “transferring the business to an investor is no longer possible under the current economic circumstances”.
The statement added: “The company lacks the necessary financial resources to continue operations and negotiations for a potential sale without jeopardising the insolvency estate and thus the interests of the creditors.
“Despite implementing various restructuring measures, the brewery is operating at a loss. According to the current liquidity plan, repaying further debtor-in-possession loans would not be feasible. Given these circumstances, there is no alternative, from both an economic and insolvency law perspective, to initiate the cessation of operations.”
Around 240 staff work at the Eichbaum site. The brewery’s work council have been informed of the decision.
“It is painful that we have to take this step. Under the given circumstances, ceasing operations is the only option,” MDs Uwe Aichele and Frank Reifel said in the statement. “Our sincere and personal thanks go to everyone involved, especially our employees, for their extraordinary commitment, their great loyalty and their long-standing dedication to the Eichbaum brewery.”
Lawyer Thomas Oberle, who has been overseeing the proceedings as Eichbaum’s court-appointed trustee, added: “We are obligated to act in the interest of all creditors and to make decisions based on economic feasibility. I support the self-administration approach of achieving the best possible satisfaction of creditors’ claims through orderly liquidation.”
Stephanie Albicker, a representative of the NGG union, said it was “extremely disappointing that a site steeped in tradition like Eichbaum has virtually no chance of survival”.
She added: “We are convinced that the company would have had a future if its existing potential had been consistently and, above all, quickly utilised. The employees and the site deserved this opportunity.”
