KTG bankruptcy: Manager in the dock
by Leo Frühschütz (comments: 0)
Two years after the spectacular insolvency of the agricultural group KTG Agrar, legal proceedings have now begun. In a civil lawsuit, the German regional court of Hamburg is negotiating claims for damages against eight former members of the management board and supervisory board, including Siegfried Hofreiter, former member of the management board.
Compensation of 189 million euros claimed
Stefan Denkhaus, the insolvency administrator, sued for 189 million euros from the managers responsible for the bankruptcy. The administrator accuses them of concealing the company’s actual situation and thereby delaying insolvency by more than a year. As a result, the creditors were massively damaged. Although, the company had completed a liability insurance for the management board and supervisory board, but only for damages of up to 60 million euros. Whether the insurance company would have to pay in the event of a conviction is not known. This is because the policy does not apply in the event of a "deliberate breach of duty" on the part of the managers. Hamburg’s public prosecution department is investigating 13 defendants from KTG 's management on account of the delay in insolvency. In April 2018, the investigators searched the apartments and business premises of former board members, Wirtschaftswoche reported.
Background to the insolvency of KTG Agrar
KTG Agrar had 800 employees and more than 46,000 hectares of cultivated land, mainly in the German federal states of Mecklenburg-Western Pomerania and Brandenburg, a large part of which was organic. The subsidiary KTG Energie operated numerous large biogas plants. The company had financed its growth through bonds. When the company was no longer able to pay their interest, KTG Agrar filed for bankruptcy. Investors lost around 350 million euros. The company was wound up in October 2016. Large parts were taken over by the Gustav Zech Foundation.