Leoni’s struggle for survival takes dramatic twist
One of Germany’s major automotive suppliers, Nuremberg-based Leoni AG, is fighting for its financial survival. In a spectacular financing scheme, shareholders are to lose all their money and the company is to be taken off the stock exchange.
Austrian entrepreneur Stefan Pierer, already one of Leoni’s larger shareholders, plans to step in with fresh capital of €150 million, Leoni announced Wednesday. Leoni, which employs more than 100,000 people worldwide, makes cable and network solutions for the automotive industry, including mainly wire harnesses. In 2022, Leoni had sales of just under 5.1 billion euros. In recent years, the company has repeatedly floundered and at times had to resort to state aid.
The sale of the important wire harness activities, which was supposed to bring €400 million into the company’s coffers and contribute significantly to debt relief, fell through at the end of last year and led to the acute emergency.
The restructuring concept now presented, involving delisting from the stock exchange and Pierer’s entry, is intended to substantially reduce the company’s debt and provide it with fresh liquidity, the company announced. Pierer will take over 708 million euros, almost half of the debt from financial creditors. In the view of Leoni AG’s Management Board, this financial restructuring concept is the only remaining restructuring solution.
Pierer is founder of investment company Cross Industries and CEO of Austrian motorbike and sports car manufacturer Pierer Mobility AG who, among others owns the motorbike brands KTM and Husqvarna Motorcycles.
The Leoni board emphasizes that it considers the company’s business model to be sound and that the reason for the difficulties is primarily to be found in the high debt burden. Nevertheless, CEO Aldo Kamper had left Leoni in the middle of the crisis at the end of January and dedicated himself to a new task as CEO of ams Osram.
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