Severely battered

Record low: Varta shares plummet by 80%

(Bild: APA/dpa/Karl-Josef Hildenbrand)

The shares of German battery manufacturer Varta, which is majority-owned by Austrian investor Michael Tojner, have plummeted by 80 percent! The ailing company intends to file for pre-insolvency restructuring proceedings shortly - probably on Monday.

On Monday morning, the shares were trading at a record low of 2.10 euros on Xetra - 80 percent less than on Friday evening.

Shareholders have to bleed heavily
"The latest developments make the situation even worse for shareholders," commented analyst Michael Punzet from DZ Bank. "The intended financial restructuring of Varta AG is clearly at the expense of existing shareholders and creditors."

According to Punzet, this could be a first step towards securing jobs and the continued existence of the company. However, the announced capital cut would lead to "shareholders leaving the company without compensation". The expert therefore lowered the fair value of the shares to 0 euros.

Over the weekend, the heavily troubled battery group announced an application for restructuring in accordance with the German Corporate Stabilization and Restructuring Act (StaRUG).

Almost 500 million euros in debt
The debt burden of almost 500 million euros must be significantly reduced, and this will require fresh capital of almost 100 million euros, said CEO Michael Ostermann, who has been brought on board as a restructurer.