As of August 27, Germanys Sovello GmbH will idle its production lines, until further notice. Company employees are expected to be informed of the decision by liquidator, Lucas Flöther at a staff meeting to be held this afternoon.
The reason for the decision has been attributed to continued plummeting sales in recent weeks. "The liquidity situation of the company was already so shattered at the opening of insolvency proceedings that almost no leeway remained," stated Flöther. "There is, therefore, no way around stopping production for the time being."
As such, the remaining 500 employees will be terminated. The majority of the workforce will be let go on September 1. A special arrangement will be made for the 22 Sovello trainees, which will be let go at the end of September. According to a statement, they will be given support in searching for a new training course. A social plan and a compensation agreement have also been negotiated with the works council.
Despite the current difficult situation, the search for an investor is continuing and talks are being held. Flöther, who was appointed liquidator 3 weeks ago following the opening of Sovellos insolvency proceedings, said the continuation of production would only lead to more losses, meaning the chance to save the company would then be over.
Translated by Becky Beetz.
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