Photon Publishing takes over insolvent Photon Europe

The insolvency administrator of Photon Europe GmbH, which published Photon and Photon International and applied for insolvency proceedings in the middle of December, has concluded an agreement with Photon Publishing GmbH, represented by Anne Kreutzmann. They agreed for continuation of the company’s business operations, as well as assumption of a share of the company’s net assets with retroactive effect as of February 1.

Kreutzmann is additionally managing director of the insolvent Photon Europe and of the newly founded Photon Publishing GmbH, and CEO of Photon Holding GmbH, which in turn is the sole shareholder of both the old insolvent and the newly established company. The agreement is subject to the condition that the purchase price is paid within the prescribed period and that the meeting of creditors grants approval.

Insolvency administrator André Seckler explained that this transfer has achieved the optimum result for the company’s employees. Approximately 90 of 140 jobs have thus been secured. The purchase price will become a part of the insolvency estate, and the contracting parties have agreed not to disclose it.

Seckler writes that he spoke with several prospective investors. However, Photon Publishing submitted the best overall offer, because it obtained access to the exploitation rights of Photon Holding, which is not insolvent – something which would have been denied to the other interested parties.

This legal construct may surprise laymen; it is, however, legal. Photon Holding owns the rights of exploitation for the brand name Photon. The insolvent company Photon Europe only produced and marketed the magazine. In the case of insolvency, which has now occurred, Photon Holding is ultimately entitled to license the rights of exploitation to an arbitrary third party.

In the event of insolvency of the production and sales company, its creditors would be left empty-handed – although the shareholder Photon Holding controlled the company’s business via subsidiaries before and after the insolvency.

The legal arrangement of Photon Publishing now appears to be the same as in the case of Photon Europe, so that the parent holding and its owners – should there be another insolvency – would again be secured by these rights and only be liable with the minimum ordinary share capital of the limited company in the amount of €25,000 as far as any debts on the part of Photon Publishing as the producer of the magazine are concerned.

It is not uncommon that the decision in favor of an investor is already prepared prior to initiation of the proceedings, since time is limited, business operations often become problematic, and compensation for lost wages and salaries is only paid for three months.

The insolvency administrator went on to explain that this period already ended at the end of January 2013. Thus he would have had to finance the company’s employees from current business, which hardly would have been possible.

From now on, Photon Publishing will have to secure operations and the resources required to this end on its own – of course "disencumbered" through the insolvency of the predecessor company.

The takeover was unanimously approved by the committee of creditors which, according to the publication of the local court includes among others, representatives from the compulsory health insurance scheme and a printing company.

The local court has called the meeting of creditors, which ultimately must approve the decision, for April 19.

Translated by Alan Faulcon.