Simplon insolvency: Bicycle manufacturer enters restructuring proceedings with self-administration
Almost 45 million in liabilities at Simplon
According to the press release, Simplon Fahrrad GmbH has liabilities of around 44.5 million euros (liabilities). This is offset by assets at book values of around 33.2 million euros, with liquidation values of around 7.3 million euros - the sum that would be realised if all assets were liquidated. With the help of the restructuring process with self-administration, 30 per cent of the debts are to be repaid to the creditors within two years.
Simplon Fahrrad GmbH has reportedly been on a challenging but, according to the company, successful reorganisation path for around a year. The bicycle manufacturer from Hard in Vorarlberg, Austria, has been in talks with potential investors for some time. However, the general decline in sales in the industry has caused the company additional economic difficulties. The reorganisation proceedings with self-administration are now intended to provide a remedy.
The economic situation on the bicycle market with strongly fluctuating demand, supply chain problems and the consequences of high stock levels forced Simplon Fahrrad GmbH to implement restructuring measures and a strict reorganisation course in 2023.
As a team and through our joint efforts, we have renewed around 40 per cent of the product portfolio, rejuvenated our brand essence and the brand message and, thanks to a strategic realignment of sales, we have been able to expand the dealer network and acquire major premium retail chains as customers. We have also achieved a significant reduction in personnel and unit costs. In addition, the existing shareholders have made great financial efforts to further secure the future. - Jakob Luksch, Managing Director of Simplon
Market development causes sales losses at Simplon
Up until the first half of the current year, Simplon performed well in line with its sales plans and forecasts. According to Simplon, the number of bicycles sold across the industry has fallen significantly by around 30 per cent since spring. The Austrians have therefore felt the effects of the current high cost and price pressure, with a corresponding impact on business and a poorer sales trend.
Self-administration in reorganisation proceedings
However, according to Simplon's own statements, the management has been in negotiations with several potential investors for some time in order to continue the reorganisation process. "We are in very good talks, as Simplon is known as a brand with a strong reputation and great potential in the industry," explains Jakob Luksch. In order not to jeopardise the negotiations, the company has now started what is known in Austria as "restructuring proceedings with self-administration". This step would secure the company's operations and solvency. It would also allow the ongoing talks with investors to continue.
The current 155 employees at Simplon in Hard and in the sales force as well as customers, suppliers and partners have been informed about everything and are motivated to continue on the reorganisation course. According to the press release, the owners of Simplon Holding GmbH, of which Simplon Fahrrad GmbH is a 100 per cent subsidiary, also continue to stand united behind the plans to bring in an investor.
Marc Strucken
Editor
