Major insolvency hits Styria’s sawmill and timber industry

Schaffer Holz, a sawmill and timber-processing company founded in 1914, has sought restructuring proceedings after its liabilities rose to 29.3 million euros.

The company, based in Eppenstein in Styria’s Murtal district, remains family-run in its fourth generation. Its assets total about 4.5 million euros, according to creditor protection organizations KSV 1870, AKV and Creditreform. Around 100 creditors and 69 employees are affected.

The company processes an average of about 100,000 cubic meters of timber a year and operates in timber trading and exports. It applied for restructuring under self-administration and says the business should continue. Its proposed restructuring plan offers creditors a 30% quota within two years.

Schaffer Holz attributed the insolvency partly to the purchase of a new production facility. Technical problems delayed its start-up and temporarily restricted production. Although most of those problems have since been resolved, customer complaints followed, and some important business partners ended their cooperation after losing confidence in the company.

The company also cited difficult market conditions in its core businesses. Roundwood prices have remained high despite problems selling products, while global crises, including the war involving Iran, hurt business. As liabilities continued to grow, the financing bank called in all outstanding loans. Schaffer Holz said it would introduce broad restructuring measures, temporarily reduce operations from two shifts to one and look for an investor.