Capital Injection for MIFA, CEO Peter Wicht Out
SANGERHAUSEN, Germany – Troubled bike producer MIFA announced CEO Peter Wicht’s departure as Management Board member “with immediate effect for health reasons”. Next to that, local authorities stepped in by acquiring the factory grounds via a so-called sales & leaseback agreement for an amount of 5.7 million euro.
The Supervisory Board appointed Dr. Stefan Weniger as new Management Board member. Trouble Shooter Weniger will be responsible for the reorganization and restructuring as Chief Recovery Officer (CRO). He joins fellow Management Board member Hans-Peter Barth, who was appointed on 20 March 2014 as the Management Board member responsible for finance and administration.
Lawyer and business administrator Stefan Weniger is managing director of hww Unternehmensberater GmbH, which ranks as “one of Germany’s leading corporate reorganization consultancies for more than 35 years”. He steps in as MIFA-CRO on an interim base.
Moreover MIFA sold its factory grounds to the regional and local authority of Mansfeld-Südharz. According to local newspapers the authorities had an extraordinary meeting on Sunday 13 April. They discussed public financial support for the bike producer being located in a region known for its high unemployment rate. MIFA is employing more than 700 people in Sangerhausen, in the former East-Germany.
MIFA Management Board member Hans-Peter Barth expressed his satisfaction: “This involvement from the regional authorities, especially the commitment of district administrator Dirk Schatz, underlines MIFA’s deep roots in its home region.”
MIFA and the local authorities signed a sale & leaseback agreement. According to a MIFA statement: “MIFA will continue to use the land, leasing it on standard market terms as part of a sale & leaseback agreement.”
Essential business partners
Moreover MIFA, the only German bicycle producer listed on the stock market, stated that after the 20 March announcement about an expected 15 million euro net loss for 2013, they: “Reached agreements with essential business partners such as suppliers, customers, shareholders and other financing partners, that contribute to the further funding of the operational business”.
MIFA appointed consultancy agency Ernst & Young to prepare a reorganization survey that will form the basis to take measures concerning the future orientation of the operating business. This reorganization survey is to be completed during the course of the second quarter. The annual financial statements for the 2013 financial year will be published prospectively in June.
MIFA has a cautiously optimistic view of the current financial year: “Our production is running normally, and has not been restricted by the topics we communicated on 20 March. Nevertheless, we regard 2014 as a year of reorganization given the loss that has been uncovered, and the structural measures. From today’s perspective, we expect significant recovery in key operating figures from 2015,” says Hans-Peter Barth.
Like in MIFA’s March 20 statement the company again notes: “Negotiations with Hero Cycle Ltd. are proceeding well with a view to a strategic partnership. Legally-binding agreements are expected within the coming weeks.”