The ailing agricultural and building materials group Baywa is receiving another financial injection. The most important creditor banks are making a further 500 million euros available in bridging loans by the end of December. The banks are also extending the standstill agreement not to call the existing loans due by three months, also until the end of the year.
In a statement published on Sunday evening it was said that Baywa now had enough time to look for a “subsequent long-term financing solution”. It was only in mid-August that banks and major shareholders supported the company with almost 550 million euros.
Baywa is in a serious crisis and is in debt of more than five billion euros. In recent years, the company has expanded massively under the leadership of long-time CEO Klaus Josef Lutz. Baywa not only sells seeds, building materials and agricultural machinery, but is also involved in wind and solar systems and in the fruit trade in New Zealand. With 24 billion euros in sales, Baywa generates more than, for example, the sporting goods manufacturer Adidas.
A renovation report by the consulting firm Roland Berger, which was published last week, showed that Baywa is fundamentally viable for the future. What is necessary, however, is a “restructuring over a period of several years”. This requires massive savings, and major job cuts are also on the cards. The end result could be the breakup of the company.