Rising costs are putting significant pressure on German businesses,and the food service sector is proving particularly vulnerable. Today, Mecklenburger Backstuben GmbH, a bakery chain with over 50 locations and 410 employees across Mecklenburg-Vorpommern and Brandenburg, filed for insolvency, seeking a self-administered restructuring to navigate mounting financial headwinds. The move highlights a growing trend of businesses utilizing Insolvenz in Eigenverwaltung-a process similar to Chapter 11 bankruptcy-to attempt a turnaround while maintaining operational control.
A wave of insolvencies is impacting bakeries across Germany. A bakery chain with over 50 locations and more than 400 employees has now filed for insolvency.
Mecklenburger Backstuben GmbH, a large bakery chain in Mecklenburg-Vorpommern, has applied for insolvency in Eigenverwaltung – a process similar to Chapter 11 bankruptcy in the U.S. – at the Neubrandenburg District Court, according to multiple media reports. A restructuring expert has been appointed to oversee the process. The move underscores the challenges facing businesses in the food service sector amid rising costs.
Large Bakery Files for Insolvency: Over 50 Locations Affected
Insolvency in Eigenverwaltung allows the company’s management to retain control and attempt a self-administered restructuring. This option is available to companies “with a healthy core business that are proactively seeking a solution,” the company stated, as reported by NDR. Employee salaries are secured through insolvency benefits until January, and all locations will remain open for now.
Mecklenburger Backstuben has operated for 40 years, running 55 locations across Mecklenburg-Vorpommern and Brandenburg and employing 410 people. A regular customer at a Schwerin location told the Nordkurier, “I really hope this location stays open. You get to know the faces, and you’re always greeted warmly. It would be a loss if this normality disappeared from my everyday life.”
Bakery Announced 50 Layoffs Earlier This Year
The future of the bakery and its locations remains uncertain. The company faced difficulties earlier this year, leading to the elimination of 50 positions in its frozen food production division. “Above all, personnel, energy, and purchasing costs have risen to a level that cannot easily be passed on to customers and partners,” lawyer Nils Krause told the Bild newspaper. However, NDR reports that management anticipates no further layoffs as part of the insolvency proceedings. The restructuring plan focuses on optimizing cost structures, processes, and liquidity planning. Sources: NDR, Nordkurier, Bild
