Release Date:
The Supervisory Board of Pfleiderer has agreed to the closure of the particleboard plant in Ebersdorf and the MDF plant in Nidda, Germany, as proposed by the Executive Board. The closures will affect approximately 300 employees at the plants and in the administrative offices in Neumarkt and Gütersloh, Germany. While alternative continuation concepts for Ebersdorf were rejected as non-expedient, alternative usage possibilities are still being sought with possible strategic investors, irrespective of the discontinuation of MDF production in Nidda.
"This is a bitter decision for those concerned, but regrettably unavoidable in view of the substantial over-capacities for particleboard and MDF in Europe. In combination with the continual price increases in raw materials, such as wood and adhesive, and energy costs, the continued operation of both plants is no longer feasible," said Hans H. Overdiek, chairman of the Executive Board of Pfleiderer.
The closures will lead to one-off costs of about EUR42 million, of which approximately EUR25 million will have a cash effect. This is partly counteracted by expected revenue from the sale of plant and property in the amount of approximately EUR25 million. The company is currently negotiating with interested parties for the plant and potential buyers of the sites, who intend to manufacture other products there.
Delivery of particleboard to customers from Ebersdorf will cease at the end of the year, and production in Nidda will close at the end of June 2011.