The Hindu Business Line : RIL’s German arm files for insolvency

The company makes high-value branded polyester fibres and filament yarns for the apparel, home textiles and automotive industries as well as hygiene and technical applications. RIL had acquired it in 2004 for 80 million euros. It had grown steadily since and turnover touched nearly 325 million euros last calendar when the recession struck.

In a press release issued here on Wednesday, RIL said, “Trevira filed an application with the Augsburg Court in State of Bavaria, Germany, for the commencement of insolvency proceedings with a restructuring plan. The move follows major efforts by the company to overcome the impact of industrial slowdown in Europe, particularly of the automotive and textile sectors to whom it is an important supplier.”

The automotive business accounts for 25 per cent of its business with the balance taken up by home textiles and technical ware.

“European textile manufacturers are currently facing a considerable drop in demand for their products, while the cost of production and employment is increasing and competition from Asian and Eastern European industries is stronger than ever,” the statement added.

Trevira has five production units spread across Germany, Denmark, Poland and Belgium. Sources say it is quite likely that it will be left only with three after the recast. Of these, Poland seems a certainty considering that it is a low-cost centre quite unlike the rest which are up against stiff labour overheads.

Trevira had only recently kicked off a recast exercise. Ms Elke Bauerle, who worked for restructuring lawyers, Schultze & Braun, had been appointed managing director to head this effort. “We shall find the best solution and this is what we shall fight for," she had said.

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