Jan 2nd, 2013
Local court admits application for protective shield proceedings of SiC Processing GmbH
The local court in Amberg has, upon application by SiC Processing GmbH on December 18, 2012, ordered debtor-in-possession proceedings in accordance with section 270b of the German Insolvency Code (Insolvenzordnung).
- SiC Processing is the global market leader in the recycling of slurry from wafer sawing processes for the wafer industry.
The management of SiC Processing GmbH, together with the international law firm Ashurst and the financial restructuring experts of the Frankfurt-based investment bank Freitag & Co, in cooperation with the preliminary supervisor now aim for a restructuring of the Company in self-administration / debtor-in-possession proceedings.
SiC Processing is the global market leader in the recycling of slurry from wafer sawing processes for the wafer industry, including logistic solutions. The Company has struggled increasingly with the continuous decline in prices and severe over-capacities in the solar sector. At the beginning of December 2012, the Norwegian subsidiary of SiC Processing GmbH filed for insolvency following the insolvency of its only customer. The Company still faces high payment arrears for several customers. In light of the coupon payment for its €82m bond, which is scheduled for March 1, 2013, the Company is threatened with inability to service its debt, pursuant to section 18 para. 2 of the German Insolvency Code.
During the protective shield proceedings under self-administration SiC Processing GmbH remains fully able to operate. The operations continue unchanged such that customers will receive their products with the same reliability and high quality as to date. Accounts receivables resulting from orders going forward will be settled as usual. Salaries accruing within the next three months will be covered by the Federal Employment Office.
SiC Processing GmbH's management will now have up to three months to present a detailed restructuring plan to the court. This restructuring plan will then to be reviewed by the court and is to be approved by the creditors' assembly. Upon approval by the creditors' assembly, the protective shield proceedings would terminate and SiC Processing GmbH could continue its operative business as a fully restructured company.
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