There were interested parties
Reportedly, at least one large German and one Austrian timber company as well as a well-known international financial services provider were interested in acquiring the group. Even for the latter, the Ziegler Group was apparently too complex and had too little substance for a profitable resale in the medium term.
Realistically, more challenging years are ahead when it comes to the sales market – and the supply situation is neither easy at the headquarters (hardly any log wood from the Czech Republic) nor in Romania. The following likely applies to all previously interested parties: No one was under the illusion that a successful continued operation would be possible in the next two or three years.
Sawmill, wood, metal, machine manufacturing, decoration, gastronomy
Most of the more than 40 subsidiaries are operating in the timber and construction industries (timber construction, wood processing, log trade). Others, however, operate in the segments goods logistics, technology/machine manufacturing (formerly Prechtl Maschinenbau), decoration, gastronomy/hotels and media (extract from the holding company’s 2022 balance sheet). The complexity of more than 40 companies and partially necessary closures were likely considered as hardly manageable by those interested in a takeover.
Is (restructuring) history repeating itself?
An example from sawmill history and, to be precise, of how things could continue is provided by the current managing director of the Ziegler Group, Jörg Artmann. The manager, who comes from the Ruhr region, was already responsible for restructuring the Klenk Holz AG a decade ago. He made what used to be Germany’s largest sawmill group fit for the Carlyle Group, a large US private equity company. Binderholz subsequently acquired the restructured, debt-free Klenk Group.
The complexity of the sale of the entire group and the start-up losses can be substantially reduced if the insolvency administrator closes down, restructures and resells individual companies. All of this could take years, though. For those interested in buying, it is more likely to get cheaper than more expensive. Nevertheless, it is safe to say that any potential buyer will need a lot of money, as there is a lack of financial means for working capital and investments.
Two jewels
Ziegler's headquarters in Plößberg – a beautiful wooden building © Ziegler Group
All industry experts agree that Plößberg and Sebes are the real assets of the holding. Both have the decisive advantage of having well-coordinated teams of employees. Plößberg has self-responsible employees at all levels, while operations in Sebes worked perfectly with the corresponding daily production specifications. The team in Plößberg, Europe’s largest sawmill site, is close-knit. In fact, some of the team members have already worked with Wilhelm Ziegler, who was head of the company from 1981 to 2008.
Different management styles
The Sebes site was acquired in 2023 © Ziegler Holding GmbH
In Sebes, the HS Timber Group practiced a classic top-down management style – in stark contrast to Plößberg. The Romanian site has only been part of the Ziegler Group for a year. As a result, the management philosophies have not yet been synchronized.
Plößberg is located in one of the most densely forested regions in Germany. Nevertheless, around 80% of the log wood came from the Czech Republic due to the supply of damaged wood in 2018 and 2019. This year, only 5% of the log wood was imported. Industry colleagues have always wondered how Ziegler managed to handle up to 2.4 million m³ without a railway connection. But it worked ...
What will happen next in Plößberg is the key question now.
Self-criticism
The Holzkurier has to ask itself self-critically whether this development could have been foreseen in 2020. Back then, we awarded Ziegler the title of “Timber Company of the Year 2021”. We particularly appreciated the precision and wide range of products offered to customers by the mega site of Plößberg. At the time, €400 million in investments were on the table – a lot, but only half of what was to come. The pellet mill in Pressath went into operation at a time when excessive pellet prices could be fully exploited. The wood fiber insulation board plant also seems like a logical investment to us, as it uses the sawmill by-products.
On November 20, the “Ziegler Group” became the “Ziegler insolvency case”, which will keep all industry participants busy for a while to come.
