Rapid embarks on reconstruction procedure

Rapid Granulator AB has been granted a suspension of old debts by the District Court of Jönköping Sweden. This has no affect on daughter companies or other partners but is only affecting the Swedish company. The court has granted permission for a so-called reconstruction procedure which – under Swedish law - allows the company to continue its business. This means the company will continue to carry out their business as usual, including the fulfilment of all service contracts, product guarantees and obligations.

CEO Rolf Gren of Rapid Group said: “Rapid AB in Sweden has been affected by the global financial crisis, like many other companies. However, as the company is mainly supplying granulators to the production industry, the world-wide drop in production has had a severe effect on volume as well as margins. In recent months, we have seen a significant increase in sales and we have taken major steps to reduce cost in terms of travel and staff. Although this has improved our cash situation, unfortunately it was not sufficient. Unlike some of our competitors in other parts of Europe, we are not able to lay off employees on a temporary basis. Therefore, this reconstruction procedure is our only realistic option.”

Mr. Gren added: “This is not a bankruptcy. In fact, we have entered the process both voluntarily and in full cooperation with our Swedish bank partner, Nordea. This reconstruction process will lead to a stronger company that will be able to serve the market even better.”