Corporate Restructuring
Haselhorst Associates designed the strategic restructuring of a subsidiary by optimising its sites and rigorously reducing fixed costs.
Client Challenge
The subsidiary of an MDAX-listed group – a provider of engineering and plant solutions for the global packaging and textile industry – was facing a loss-making business development. Although the company was legally independent, its high level of operational integration within the group led to a group liability risk, which ruled out insolvency or similar restructuring approaches. A turnaround therefore had to be achieved internally through operational, structural and strategic realignment.
The subsidiary expected to incur significant losses. The main causes were:
- Strong competitive pressure from Asian market participants
- Political situation in Turkey, one of its most important sales markets
- Temporary decline in demand due to the end of a technology cycle
To make matters worse, although the parent company had the authority to issue instructions, legally relevant measures (e.g. personnel or contract decisions) could only be implemented by the subsidiary’s management. The restructuring therefore required intensive coordination between the group and the company management.
The overall challenge:
Stabilise operations, reduce costs, ensure legal compliance and examine whether the two European locations could be consolidated – all without disrupting ongoing operations.
Haselhorst Approach
Haselhorst Associates developed and implemented a comprehensive restructuring programme that combined strategic consulting with operational implementation.
The key elements of the approach included:
- Developing a restructuring concept for both European locations
- Evaluating consolidation scenarios to determine the optimal location structure
- Planning structural adjustments in line with the newly defined target turnover
- Close cooperation with the subsidiary’s management to ensure legally compliant implementation
- Practical support during the implementation of all restructuring measures
At the same time, Haselhorst coordinated the alignment between group management and the subsidiary, ensured that strategic goals were translated into concrete measures, and guaranteed the operational stability of the unit.
Results
The restructuring measures led to clear and sustainable results. Targeted realignment enabled both European locations to be retained, as the analysis showed that a two-location model would remain viable after optimisation. Structural adjustments led to noticeable reductions in fixed costs and aligned the organisation with realistic market dynamics.
Results at a glance:
- Retention of both European locations
- Significant reduction in fixed costs through structural adjustments
- Appointment of project managers to coordinate and implement the restructuring measures
- Sustainable increase in EBIT and total output
Overall, the company was able to restore its financial stability and strengthen its competitive position for the next demand cycle.
About the Client
The customer is a manufacturer of chemical plants and part of an MDAX-listed industrial group that is one of the international market leaders in large-scale plant construction. The commissioning division is responsible for the construction of chemical plants and has expanded its portfolio by acquiring a company specialising in polycondensation plants. This subsidiary serves customers in the packaging and textile industries worldwide and generates annual sales of 55 million euro. The project lasted five months, with Dr. Jörg Schumacher acting as the main contact person.
