Austrian sawmill and wood-processing company Schaffer Holz has filed for insolvency with liabilities of approximately \u20ac29.3 million, after problems with a major new production investment combined with high log prices and difficult lumber markets. The 112-year-old company intends to continue operating under a restructuring procedure and is seeking an investor.<\/p>\n
Schaffer S\u00e4gewerk-Holzexport GmbH, based in Eppenstein in the Austrian state of Styria, filed for restructuring proceedings with self-administration at the Regional Court of Leoben. Around 100 creditors and 69 employees are affected.<\/p>\n
The company has assets valued at approximately \u20ac4.5 million on a liquidation basis, according to KSV1870, against liabilities of \u20ac29.3 million. This leaves a calculated shortfall of around \u20ac24.8 million. AKV has reported an even lower liquidation value for the assets of approximately \u20ac3.5 million.<\/p>\n
Schaffer, founded in 1914 and run by the fourth generation of the family, processes around 100,000 solid m\u00b3 of wood annually. Its activities include sawmilling, timber trading and exports.<\/p>\n
The company plans to keep the Eppenstein operation running during the proceedings. Creditors are being offered a restructuring quota of 30% payable within two years.<\/p>\n
\u20ac27 million investment at centre of insolvency<\/strong><\/p>\n A major investment in new production equipment is one of the principal factors behind the insolvency.<\/p>\n Schaffer invested approximately \u20ac27 million in a new production facility that was commissioned in 2025. The project was intended to modernise the sawmill, but bringing the equipment into full operation proved considerably more difficult than expected.<\/p>\n Technical problems restricted production during the ramp-up. The difficulties subsequently resulted in customer complaints and damaged relationships with several important business partners, some of which stopped working with Schaffer.<\/p>\n Many of the technical problems have since been largely resolved. The damage to the company's finances, however, had already accumulated. Schaffer was carrying the cost of a large investment without receiving the expected production and cash flow from the new equipment quickly enough.<\/p>\n The value of those investments is now likely to receive particular attention during the insolvency proceedings. AKV has questioned the sharp reduction in the company's asset valuation, noting that much of the asset base consists of relatively recent investments.<\/p>\n Previous asset values were around \u20ac34.5 million. The liquidation values reported during the insolvency proceedings are substantially lower, with KSV1870 putting assets at approximately \u20ac4.5 million and AKV at around \u20ac3.5 million. The eventual recoverable value of the equipment could therefore have an important bearing on the position of creditors.<\/p>\n High log prices add to sawmill pressure<\/strong><\/p>\n The investment difficulties came at a particularly difficult time for the company's core business.<\/p>\n Schaffer has cited persistently challenging market conditions alongside high roundwood prices. The cost of logs remained elevated even as conditions for selling finished lumber became more difficult. International disruptions, including the Iran war, also negatively affected business.<\/p>\n The combination left the sawmill exposed on both sides of its margin. Raw-material costs remained high while weaker lumber markets restricted its ability to pass those costs through to customers.<\/p>\n Schaffer operates partly in specialised lumber markets. The company processes spruce, fir and larch and is known for fine-ringed lumber supplied to customers including window-component manufacturers and musical-instrument producers.<\/p>\n The insolvency therefore developed from several problems occurring at the same time. The new production equipment failed to ramp up as planned, some customers were lost following production problems, and difficult lumber markets provided little room to absorb the resulting costs.<\/p>\n Bank calls in loans as liabilities rise<\/strong><\/p>\n The financial pressure eventually reached a critical point as Schaffer's liabilities continued to increase.<\/p>\n The company's financing bank called in its outstanding loans, removing the financial room available to continue absorbing losses and investment-related costs.<\/p>\n Schaffer subsequently opted for insolvency proceedings structured around continued operation rather than immediate liquidation. Under the proposed restructuring plan, creditors would receive 30% of their claims within two years.<\/p>\n Gernot Prattes has been appointed restructuring administrator. His role will include assessing whether continued operation is in the interests of creditors and whether the proposed restructuring plan can realistically be fulfilled.<\/p>\n The size of the liabilities means that operating performance during the coming months will be critical. The proposed creditor quota is intended to be financed from continued business operations, making positive cash generation at the Eppenstein site a central part of the plan.<\/p>\n Production reduced from two shifts to one<\/strong><\/p>\n Schaffer has already outlined significant cost reductions.<\/p>\n Production is expected to be temporarily reduced from two shifts to one in response to current market conditions. The measure will lower the operating burden while the company works through the restructuring process.<\/p>\n Creditreform has warned that extensive restructuring will be necessary given the level of liabilities. Without rapid cost reductions, the creditors' association said closure and liquidation could ultimately become unavoidable.<\/p>\n There are nevertheless factors supporting the attempt to continue operations. Schaffer still has a high order backlog, while many of the technical difficulties affecting the new production equipment have now reportedly been resolved.<\/p>\n The problem is therefore not an absence of orders alone. Schaffer must now produce those orders at margins and cash-flow levels sufficient to support the business while substantially reducing its cost base.<\/p>\n Investor sought as part of restructuring<\/strong><\/p>\n Finding an investor is another central part of Schaffer's restructuring strategy.<\/p>\n The company is seeking a financially strong strategic partner that could help stabilise the business and secure the longer-term future of the Eppenstein operation. Continued production, cost reductions and outside investment are intended to provide the basis for meeting the proposed creditor settlement.<\/p>\n The insolvency comes after an unusually damaging sequence for the company. A \u20ac27 million investment intended to modernise production instead encountered technical difficulties during its ramp-up. The resulting disruption contributed to customer losses just as high log prices and weak lumber markets were already putting pressure on sawmill margins. Rising liabilities were followed by the bank calling in its loans.<\/p>\n Schaffer's existing order backlog and the reported resolution of most technical problems give the company a basis from which to attempt a recovery. But the scale of the liabilities means that reducing production from two shifts to one is unlikely to be the only adjustment required.<\/p>","protected":false},"excerpt":{"rendered":" Austrian sawmill and wood-processing company Schaffer Holz has filed for insolvency with liabilities of approximately \u20ac29.3 million, after problems with a major new production investment combined with high log prices and difficult lumber markets. The 112-year-old company intends to continue … Continue reading