DOMO Chemicals GmbH, DOMO Caproleuna GmbH and DOMO Engineering Plastics GmbH, all as German subsidiaries of the Belgian chemical company DOMO Chemicals, have filed for insolvency with administrator reviewing potential restructuring options.

Plants of DOMO Chemicals GmbH in Leuna, Germany. (Source: DOMO Chemicals)

Recent market challenges

DOMO Group’s businesses have been affected by persistently weak demand in the European chemicals sector. High energy costs and a strong rise of imports of polyamide resin from non-EU countries, in particular from China, have further exacerbated the situation.

In response, the management team began a restructuring process in 2024. However, after talks over further short-term financing recently broke down, the three German entities were forced to file for insolvency.

Insolvency administrator reviewing restructuring options

The competent local court has appointed Prof. Dr. Lucas F. Flöther from the law firm Flöther & Wissing as the preliminary insolvency administrator. Flöther intends to continue business operations and is currently reviewing potential restructuring options.

“Day-to-day operations are continuing at all locations. Manufacturing and customer deliveries remain uninterrupted,” emphasized Flöther.

Together with his team, Flöther had informed the approximately 585 employees about the situation, of which wages and salaries are secured for the next three months through insolvency benefits.

Up-coming actions

In the coming weeks, the preliminary insolvency administrator will work closely with creditors and company management to gain a clear picture of the financial situation and assess available restructuring options, including securing an investor or reaching a settlement with creditors.

Although the market environment for chemical companies is challenging, Flöther pointed out that the German companies of the DOMO Group have the advantage as technology leaders in the field, including owning a highly capable workforce and a strong, reputable customer base.