GEA
Job cuts at Zimmer / Possibility of sale on its own or with Lurgi / Withdrawal from plant engineering
An "unsatisfactory volume of new orders" has resulted in considerable under-utilisation of capacity at the plant and machinery manufacturing company Zimmer (Frankfurt / Germany; www.zimmer-ag.de) and forced the parent company GEA Group (Bochum / Germany; www.geagroup.com) to take action. As stated in its report for Q2 2006, the first step will be to make up to 100 of the 250 employees redundant.
Provisions of EUR 17m have been set aside for the redundancy plan and other direct costs resulting from these measures. In addition, GEA has completely written off Zimmer´s goodwill, which means that one-off expenses now total around EUR 71m. Discussions are currently being held with "prospective buyers" of the scaled-down operation, continues the report.
If these discussions should fail, Zimmer may be fully integrated into GEA´s Lurgi Division (Frankfurt / Germany; www.lurgi.com). Speculation on a complete cessation of activities was firmly denied by GEA Board Chairman Jürg Oleas at the half-year press conference on 10 August 2006.
In any case, GEA would like to spin off large parts of the plant engineering division, namely Lurgi, Zimmer and Lurgi Lentjes. Only the smaller unit Lurgi Bischof (gas purification) would remain at GEA and be integrated into another division. Since the Lurgi results in particular have developed positively, the company says that numerous enquiries have been received about a takeover. The board has engaged the services of Morgan Stanley investment bank to quickly find a suitable buyer. It is hoped that the process will have been completed by the end of the year.
Lurgi is the leading plant engineering company in the field of synthesis gas, which also includes the conversion of gas into petrochemical materials. Lurgi Lentjes operates in the energy production segment and Zimmer is the world market leader in the construction of plants for bottle-grade PET, and is also one of the leading companies for polymerisation units for PET and PA fibres and granules.
e-Service:
GEA Group interim report 2006 as PDF document (284 KB)
Provisions of EUR 17m have been set aside for the redundancy plan and other direct costs resulting from these measures. In addition, GEA has completely written off Zimmer´s goodwill, which means that one-off expenses now total around EUR 71m. Discussions are currently being held with "prospective buyers" of the scaled-down operation, continues the report.
If these discussions should fail, Zimmer may be fully integrated into GEA´s Lurgi Division (Frankfurt / Germany; www.lurgi.com). Speculation on a complete cessation of activities was firmly denied by GEA Board Chairman Jürg Oleas at the half-year press conference on 10 August 2006.
In any case, GEA would like to spin off large parts of the plant engineering division, namely Lurgi, Zimmer and Lurgi Lentjes. Only the smaller unit Lurgi Bischof (gas purification) would remain at GEA and be integrated into another division. Since the Lurgi results in particular have developed positively, the company says that numerous enquiries have been received about a takeover. The board has engaged the services of Morgan Stanley investment bank to quickly find a suitable buyer. It is hoped that the process will have been completed by the end of the year.
Lurgi is the leading plant engineering company in the field of synthesis gas, which also includes the conversion of gas into petrochemical materials. Lurgi Lentjes operates in the energy production segment and Zimmer is the world market leader in the construction of plants for bottle-grade PET, and is also one of the leading companies for polymerisation units for PET and PA fibres and granules.
e-Service:
GEA Group interim report 2006 as PDF document (284 KB)
21.08.2006 Plasteurope.com [206111]
Published on 21.08.2006
German version of this article...