MIFA Stakeholders Disagree on Further Funding
SANGERHAUSEN, Germany – The insolvent bicycle manufacturer MIFA struggles for its survival. The roughly 520 employees were informed yesterday that the production will not be re-started at the end of this month, as was previously planned.
“The attempt to reorganize the company failed,” said restructuring manager and current managing director Joachim Voigt-Salus at a press conference yesterday. “Therefore we had to apply for a regular insolvency in order to continue the company.”
Millions needed for parts
Insiders report that MIFA’s Joachim Voigt-Salus registered for insolvency after the stakeholders informed him on their disagreement for an additional funding of 8 million euro. That money is needed on a short term in order to continue MIFA.
The 8 million had to come from the Von Nathusius family as well as 3 million from the bank. According to the MIFA management, “The money is needed for sourcing parts in order to guarantee delivery to large customers. For this spring we have orders for 100,000 bicycles. For being able to deliver them in time we had to order parts at the latetst last Tuesday.”
Regular insolvency within two weeks
The regular insolvency follows after the company entered into ‘insolvency in self-administration’ which was filed on January 4. It provided the company creditor protection for a three months period. During this time production was supposed to continue at MIFA and the wages of the about 520 people working at MIFA would be paid by the German government employment agency.
Apart from the needed parts for the ordered bikes, the reason why MIFA’s restructuring manager Joachim Voigt-Salus cancelled this ‘insolvency in self administration’ and filed for a regular insolvency within two weeks remains unclear. Is it also because, without the millions needed, he sees no future for MIFA or does he want to move on quickly and find new investors outside the Von Nathusius family?
At yesterday’s press conference Joachim Voigt-Salus pointed out that, “The workforce will have to be reduced in order to keep the daily operation running. All wages have been guaranteed till the 1th of March.” It remains unclear how much the employees can expect from the state of Saxony-Anhalt who have been closely involved to save MIFA and with that the more than 500 jobs.
Last Tuesday, January 17, the Prime-Minister of the state of Saxony-Anhalt, Reiner Haseloff, still stated that, “The survival of MIFA was given top priority by the state of Saxony-Anhalt. We do everything we can to help the company.” He also stressed that, “The rescue of MIFA was important for the structurally weak region which continues to have the second highest level of unemployment in Germany for years.”