Bankruptcy of Dutch printing companies

After a filing for suspension of payments on Friday April 12 for Roto Smeets BV, the holding company for the Dutch printing activities Roto Smeets Deventer, Roto Smeets Weert and Senefelder Misset in Doetinchem (and the underlying subsidiaries), parent company Circle Media Group has decided today to also file for bankruptcy of the Dutch printing companies. The suspension of payments was intended to examine the possibilities for a reorganisation of the companies, but it soon became clear that this is not feasible anymore.

Dutch Dismissal Law (Wet Werk en Zekerheid)

Joost de Haas, Executive Director Circle Media Group and CEO of Roto Smeets Group: "These bankruptcies are the result of the current, very challenging market circumstances in the European printing industry. After a reasonable 2017, we saw a strong deterioration of the market in 2018. Paper prices increased with 15-20 %, while our printing volumes decreased twice as fast as on average level. Under these circumstances, a planned reorganisation in the 2nd half of 2018 turned out to be insufficient during the first months in 2019.

At the same time, the new Dutch Dismissal Law (Wet Werk en Zekerheid) proved to be unworkable for larger restructurings in a shrinking industry, like print. Severance payments are three times as high as under our former redundancy plans and force pre-payment instead of spread payments. Up to the introduction of this law, we were able to reduce our workforce with almost 1,000 employees in a socially-responsible manner, while bringing employees from work-to-work. This made it possible to adapt our capacity to our shrinking market and industry. The new Law works counterproductive and now forces us to lay-off our employees without a social plan. These bankruptcies could have been prevented with a more flexible law.

With the administrator, we will now try to do the utmost to restart the bankrupt companies, while trying to secure as much jobs as possible and to continue the production for and service to our customers."

The suspension of payment does not include the Dutch marketing operations in Amstelveen (MPG), nor the Belgian operation Corelio Printing and other printing companies in Austria, Germany,  Spain and Hungary.

sbr / 04/17/2019