The investor process for the insolvent airline Germania is entering the next stage. Preliminary insolvency administrator Rüdiger Wienberg has received concrete offers for a takeover of the airline’s operations. In the meantime, the Group holding company and another company have also filed for insolvency.
Three potential investors are interested in taking over the entire package, which consists of a large part of the route network of Germania Fluggesellschaft mbH as well as maintenance and service capacities of Germania Technik GmbH and Germania Flugdienste GmbH. Out of the three candidates, two have already submitted a bid. In addition, there are a number of interested parties who would like to take over maintenance and/or services without flight operations. “We would prefer a comprehensive solution, of course,” said Wienberg. “At this stage in the process, however, we are not yet narrowing ourselves down on one scenario, but continue negotiations for both options.” The candidates who are still in the process are almost exclusively strategic investors, i.e. companies from the industry. Because of confidentiality agreements in force, the preliminary insolvency administrator did not provide any further details.
Wienberg works towards a so-called “transferring reorganization”, in which business operations or parts thereof are sold and transferred to a new, insolvency-free company. If flight operations are transferred, the investor would resume operations at short notice, managed by the new company. In order to make this possible despite the “grounding” imposed by the German Federal Aviation Authority (LBA) three weeks ago, Wienberg will continue to work intensively to secure the necessary aviation permits and essential slots. Action-ready crews and ready-for-use aircraft also continue to be available.
Wienberg emphasized that the claims of Germania‘s customers will not be transferred to a potential investor. “In the case of a transferring reorganization, the investor only takes over business operations, and not the liabilities of the company,” the preliminary insolvency administrator clarified. “Under current insolvency law, passenger claims for carriage or reimbursement of cancelled flights must remain part of insolvency assets.” This is against the backdrop that insolvency law deliberately provides incentives to preserve business operations and jobs of ailing companies. Since the sale of an active business naturally generates much higher proceeds than the closure of a business, this will also directly benefit the creditors.
In the meantime, the German Federal Employment Agency has also approved the pre-financing of the insolvency money for the months of February and March. This concerns the employees of all three companies affected by the insolvency since February 5th, whose salaries can now be paid out punctually at the end of the month. “This is not only good news for our colleagues, but also underlines that Germania has good prospects,” said Wienberg. The Federal Employment Agency regularly approves pre-financing only if there are serious prospects of restructuring. “We were able to demonstrate this in a convincing manner.”
Meanwhile, two other companies of the Germania Group have filed for insolvency: the parent company Germania Beteiligungsgesellschaft mbH (7 employees) and its wholly-owned subsidiary Germania Reisen GmbH (4 employees), which acts as travel agent for the tour operator Vtours. On February 26th, 2019, the district court of Charlottenburg appointed Wienberg as preliminary insolvency administrator for these companies as well. Today, Wienberg and his team are reviewing the particular situation of these two companies. They filed for insolvency because of liabilities to the operating companies. The wages and salaries of the employees there are secured by the insolvency money.
The airline Germania filed for insolvency on February 4th. The preliminary insolvency proceedings concern Germania Fluggesellschaft mbH (1,426 employees), Germania Technik Brandenburg mbH (178 employees) and Germania Flugdienste GmbH (74 employees). Swiss Germania Flug AG and Bulgarian Eagle are not affected by the insolvency.
Germania is an independent German airline with a history that goes back more than 30 years. The airline with the green and white logo carried more than 4 million passengers per year on short-haul and medium-haul flights. Up until its “grounding” on February 5, 2019, Germania offered connections from 18 departure airports in Europe to over 60 destinations within the continent, in North Africa and the Middle East. Reversing the common industry trend, Germania continued to offer complimentary snacks, soft drinks, magazines and a minimum of 20 kg free baggage allowance. Germania’s business model combined scheduled, charter and ad-hoc flights. Together with Bulgarian Eagle and the Swiss airline Germania Flug AG, Germania operated a fleet of currently 37 aircraft. Germania Technik Brandenburg GmbH is responsible for the company's aircraft maintenance. www.flygermania.com
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hww hermann wienberg wilhelm is one of the leading service providers specialising in legal advice, restructuring, insolvency and receivership in Germany. With several hundreds of employees, hww is represented in more than 20 cities in Germany and has its own international network. Insolvency administrators from hww hermann wienberg wilhelm have been appointed by numerous insolvency courts throughout Germany in thousands of insolvency proceedings over the years. High-profile proceedings involving the law firm include the insolvencies of Holzmann, Karman, Q.Cells, topbonus and SOLON. www.hww.eu
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