MIFA Mitteldeutsche Fahrradwerke AG
MIFA continues restructuring of the business operations in self-administration

MIFA continues restructuring of the business operations in self-administration

– MIFA board of management applied to the relevant district court Halle (Saale) for self-administration today

– In filing the application the board of management responded to not kept covenants made in the basic agreement on implementing financial restructuring of MIFA dated 22 August

– The operative business of MIFA will continue as planned during the insolvency proceedings in self-administration

– MIFA board of management plans to initiate a sales process without delay in parallel with the further restructuring process

– Positive assessment of the industrial restructuring capacity of MIFA is unchanged

Sangerhausen, 29 September 2014 – The board of management of MIFA Mitteldeutsche Fahrradwerke AG (WKN: A0B95Y / ISIN: DE000A0B95Y8; ‘MIFA’) filed an application today to open insolvency proceedings in self-administration pursuant to Section 270a of the Insolvenzordnung (insolvency code) with the district court Halle (Saale) to enable it to continue the restructuring process of MIFA itself. The operative business of MIFA remains unaffected and will continue as planned.

An essential element of the basic agreement, which was concluded on 22 August with OPM Global B.V., a subsidiary of the Indian bicycle manufacturer Hero Cycles Ltd. (‘HERO’) to financially restructure MIFA could not be implemented despite the covenants given.

“Despite intensive negotiations with those responsible at HERO it has so far not been possible to achieve an ultimate solution in one part of the agreement. For this reason, I have decided in view of my responsibility for the MIFA employees to file an application with the district court”, said Dr. Stefan Weniger, at present the sole managing director of MIFA. “The instrument of self-administration gives us the possibility to continue the successful restructuring process that has been launched on our own and ensure trouble-free continuation of the operative business.”

Provided that the Amtsgericht consents to the self-administration applied for, the MIFA board of management will be provided with a preliminary custodian (Sachwalter). Business responsibility will remain in the hands of the board of management with Dr. Weniger, who at present is the sole managing director and who will be joined by Thomas Mayer on 1 October as announced. Mayer will have responsibility for operative business. The prerequisite is that the company has a viable business operation. In the view of Dr. Weniger this prerequisite exist: “We are basically in a position to execute the order in our books, which are well filled, as planned and we cannot run the risk of endangering problem-free continuation of business due to delays in implementing the restructuring of capital. After all, performance-related restructuring must be implemented at an early date in addition to financial restructuring. The application does not affect the positive assessment of the industrial restructuring capacity of MIFA.” The board of management will continue the business operations of MIFA to the full extent.

In addition, the board of management will initiate a sales process without delay. “The signals are clear: MIFA has made very good progress in restructuring through its own efforts in the last few months. The overall restructuring plan that is still being implemented provides for comprehensive measures for the future strategic and operative development of the business operations. Coupled with the large market potential of the bicycle industry, I am convinced this forms an ideal basis for us to return to profit as early as in the 2015 financial year. I am convinced that MIFA as a forward-looking company in an industry of the future will be of great interest to plenty of investors”, said Dr. Weniger. The wages and salaries of the employees, which numbers around 600 at present, are guaranteed by the Bundesagentur für Arbeit (federal employment agency) for three months.

About the company:

MIFA Mitteldeutsche Fahrradwerke AG, headquartered in Sangerhausen (Saxony-Anhalt), is Germany’s largest manufacturer of bicycles in terms of sales. The company offers a comprehensive range of bicycle models spanning entry price through to premium end. The components included in bicycle production are sourced from renowned suppliers and assembled at the company’s sole production site in Sangerhausen, Germany. Business in this context focuses on product-related order production for major retail chains and OEM (Original Equipment Manufacturer) customers. E-bikes have also been manufactured since 2011. MIFA produces e-bikes for automotive manufacturer smart, manufactures for the Deutsche Post bicycle fleet, and supplies communal lending systems with multi-user vehicles, among other customers. In 2012, MIFA acquired Berlin-based e-bike manufacturer Grace and Bavaria-based cult bicycle forging company Steppenwolf, thereby intensifying its sales activities via specialist dealers. MIFA sells its bicycles predominately on its domestic German market. Further sales markets are located mainly in Western Europe. Both the operating business and administration and logistics are managed at the company’s sole production location in Sangerhausen.

MIFA has been a listed company since May 2004. Its shares are traded in the Prime Standard of the Regulated Market of the Frankfurt Stock Exchange. MIFA’s corporate bond is listed in the Entry Standard for bonds on the Frankfurt Stock Exchange.

Contact:

Mark Appoh
cometis AG
Unter den Eichen 7
65195 Wiesbaden
Tel.: +49 (611) 205855-21
Fax: +49 (611) 205855-66
E-Mail: appoh@cometis.de