It appears that operations at the Leuna chemical site will continue: a newly established company is taking over key parts of the business in Saxony-Anhalt. However, not all staff will be retained.
After around 14 weeks of uncertainty, this development offers a new outlook for the site. The planned closure of the facilities belonging to the Belgian company Domo Chemicals in one of Germany’s largest chemical parks will not go ahead.
The facilities of the German subsidiary Domo Caproleuna are being taken over by the chemical company Leuna-Harze and the operator of the chemical park, Infraleuna. Domo Caproleuna had filed for insolvency over the Christmas holidays, together with two other German companies within the group. The specially established company Leuna-Polyamid is taking on 436 of the previously nearly 500 employees, in addition to the facilities. At the same time, the competent court opened insolvency proceedings against the three German Domo companies.
Details of the takeover
Insolvency administrator Lucas Flöther, who had been keeping the business running since the end of December, described the agreement as having been reached at short notice. The parties have agreed not to disclose the purchase price. Klaus Paur, owner and managing director of Leuna-Harze, estimates that the financial requirements for restarting the plants amount to around 50 million euros.
The new owners’ aim is to stabilise the business financially and develop it further. According to current information, there are no plans for a subsequent sale. Martin Naundorf, previously involved in site marketing at Infraleuna, will take over the operational management of Leuna-Polyamid.
The state government of Saxony-Anhalt had already introduced measures to avert risks back in January, thereby laying the groundwork for a structured investor process.
Background and context
On this basis, the continued operation of the plants was also secured financially. The state provided around 80 million euros for this purpose in recent weeks. The agreement was reached shortly before this measure expired at the end of March.
The case also highlights the economic challenges facing the site. Interest from external investors remained limited due to the tense market situation in Europe and increasing competition in the basic chemicals sector – particularly for products such as caprolactam.
The decision by Leuna-Harze and Infraleuna to take over the facilities must also be seen against the backdrop that decommissioning the plants would have entailed considerable risks for the companies involved as well as for the entire site.
