Insolvent transport company is fighting for restructuring with 36 million euros in debt

The transport company, founded in 1992, employs 191 people and a further 270 people work in affiliated companies. With over 300 leased or rented towing vehicles and just as many truck semi-trailers and trailers, most of which are owned by third parties, Nothegger is one of the larger players in the transport industry in Tyrol. This magnitude also explains the enormous daily liquidity requirements, which have now become the company’s downfall.

Continuation under difficult conditions

Despite the tense financial situation, the company has continued to operate since bankruptcy was declared. The management has announced a restructuring plan and has so far been able to essentially maintain the number of employees – an important signal for both the workforce and the company’s customers. But the framework conditions for continuation are extremely challenging.

A central problem is the liquidity situation: customer receivables for services that were provided before the bankruptcy was declared have already been assigned to the bank due to an existing factoring agreement. As a result, for a long time no income flowed into the insolvency estate, which significantly restricted the insolvency administration’s ability to act. The company essentially had to start from scratch while maintaining ongoing costs.

“Despite all adversities, the insolvency administrator has so far managed to maintain operations. Lawyer Mag. Walter Rupprechter and lawyer Mag. Ing. Stefan Rass from the insolvency administrator reported to the KSV1870 that the Nothegger family had provided a continuation deposit of around 1.4 million euros at short notice. In addition, it was possible to generate liquidity amounting to one million euros through a rapid divestiture of a shareholding. At the same time, various investments were made Settlement accounts, which showed claims of the insolvent debtor amounting to several hundred thousand euros against people close to the owners of the insolvency debtor, were quickly settled,” according to the KSV1870.

Fuel prices as an additional burden

The situation was made worse by the most unfavorable timing: around the time the bankruptcy was declared, fuel prices rose sharply. “An immediate adjustment of the prices for services that had already been promised was not possible,” reported the insolvency administrator at the meeting. The transport company had to process orders under the old conditions that no longer covered costs, while fuel costs exploded – a situation that placed additional strain on the already strained liquidity.

The situation has now eased somewhat on this point: when new contracts are concluded, adjusted, market-based prices can now be agreed that take the increased fuel costs into account. This should noticeably improve the company’s operational situation and is an important prerequisite for a successful restructuring.

Complex examination process is still ongoing

Today’s examination meeting dealt exclusively with the claims that were registered on time. Of the 36.4 million euros audited, less than half were initially recognized – a common procedure in insolvency proceedings in which the administration critically examines the claims. Creditors whose claims were disputed now have one month to file declaratory judgment actions and enforce their claims in court.

What makes matters worse is that after the registration deadline, numerous other claims were received that could not yet be examined at today’s meeting. These will have to be dealt with in a subsequent examination meeting that has yet to be scheduled. The actual amount of debt could therefore increase.

Reorganization plan needs external support

Based on the results of today’s meeting, the Alpine Creditors Association (AKV) assumes that the debtor will present a restructuring plan. Austrian insolvency law requires a minimum quota of 20 percent for such a plan, which must be paid out to creditors within two years. With recognized claims of 15.4 million euros, this would mean that around 3.1 million euros would have to be raised.

The crux of the matter is that, as things currently stand, this quota cannot be generated from operational business. The company will therefore rely on financial support from third parties – be it from investors, the owners themselves or other financiers. It is currently unclear whether and in what form this support will come.

The situation remains tense for the 191 employees and the numerous creditors. The coming weeks will show whether it will be possible to present a viable restructuring plan and secure the necessary external financing. Only then does the transport company, which has been in existence for over 30 years, have a realistic chance of surviving the crisis.