Traditional company Hakle files for insolvency proceedings

Toilet paper manufacturer Hakle is struggling to survive. The family company from Düsseldorf has filed for so-called insolvency proceedings under self-administration. The reason for the imbalance is the sharp rise in energy and raw material prices, reports the medium-sized company with almost 100 years of tradition and well-known brands such as Hakle, Hakle Feucht, dick

In the case of self-administration, the existing management remains on board, but is supported by restructuring experts, in this case by Jan-Philipp Hoos from the White law firm

The issue of energy supply is currently a major burden for the entire industry. The paper industry association recently emphasized this again and even warned of supply bottlenecks. Because large amounts of gas would be required for production. Because the price has recently reached new record highs, manufacturers have regularly stopped production temporarily in recent months. "The production just didn't pay off anymore," explains Gregor Andreas Geiger, Managing Director of Communications and Public Relations at the Paper Industry Association.

The industry is looking for alternatives when it comes to energy supply. “Where possible, attempts are made to cover demand with coal, heating oil or electricity. So far, however, a maximum of ten to 15 percent of the use of natural gas can be substituted,” reports Geiger. “Many companies are aiming for plants that are operated with hydrogen. And theoretically that would already be possible in many places,” says the expert. Only the necessary amounts of hydrogen are missing. "Until then, gas is the interim solution."

Hakle is the first well-known brand manufacturer from the consumer goods industry that had to go to insolvency court due to the consequences of the Ukraine war. Business operations continue unchanged for the time being, the wages and salaries of the approximately 225 employees are paid for three months through the insolvency allowance from the Federal Employment Agency.

Hakle sees himself as a victim of the current events, first of all the Corona crisis and a wave of hamster purchases and then the Ukraine war and its effects. "Since the beginning of the corona pandemic in 2020, the energy-intensive paper industry has been subject to severe upheavals in the global raw materials, logistics and energy market," the company said. Since autumn 2021 there has been a "historical deterioration in the situation", especially in the gas and electricity sectors.

Hakle is a consumer goods manufacturer with a long tradition. The company was founded in 1928 in Ludwigsburg by the namesake Hans Klenk, who simply used the first two letters of his first and last name for the company and product. At that time he brought the first toilet paper roll with a guaranteed 1000 sheets onto the German market. At the end of the 1990s, an eventful episode in the company's history began with various owners, including Kimberly-Clark, itself one of the largest suppliers in the sanitary paper market, and later a financial investor.

During this phase, the company moved from Ludwigsburg to Düsseldorf to a location in the Reisholz district where paper has been produced since 1905. Since 2019, Hakle has been owned half by Managing Director Jung and half by the investor Crosslantic.

Hakle's high profile is based not least on the company's innovative strength. According to Hakle, it brought the first three-ply toilet paper onto the German market in 1972 and ten years later the first four-ply toilet paper. In addition, Hakle Feucht was invented in 1977, the first moist toilet paper. And to this day, this brand name is synonymous with the entire product category. In terms of company size, however, Hakle, with its recent annual turnover of almost 80 million euros, is behind other providers such as Wepa, Essity or Kimberly-Clark.

In total, there are almost ten manufacturers in Germany who produce around 750,000 tons of toilet paper per year across the country, reports the Association of the Paper Industry. This corresponds to a share of 3.4 percent of the total paper production in Germany. Around a sixth of production goes abroad, while goods of a similar size come back from foreign manufacturers.

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