BAVARIA Industriekapital AG is an industrial holding company specialising in the takeover and re-organisation of earnings-poor and/or unprofitable enterprises. In the process, we pursue three key objectives: cutting costs, developing new sources of turnover revenue, and preserving as many jobs as possible. We believe that properly motivating a distressed company’s workforce is the best way to boost its innovation potential and eliminate all forms of unnecessary wastage – e.g. product rejects or excess idle time in the production cycle. Thus, we impress on all stakeholders that ensuring the takeover company’s long-term profitability is the only way to safeguard future job security.
The fundamental concept underlying our business strategy is to assume control of those none-core activities of the target company that can be carried on more profitably on a stand-alone basis. Before being taken over by BAVARIA, a distressed company often has no alternative but to shut down its money-losing activities. Once BAVARIA has performed the necessary personnel adjustment and restructuring, however, the number of employees can usually be scaled back up, but this time in the context of profitable operations.
By deploying its in-house “Operating System”, BAVARIA helps companies to identify potential cost savings and performance enhancements,
while supporting implementation of all measures deemed to be necessary. Once a target company’s processes have been successfully optimised, this generally also leads to a reduction in working capital. The capital freed up in this manner can then be applied towards a rapid paydown of the existing debt load.
Thus far, not one of our target companies has had to take on additional debt to finance its takeover by BAVARIA. It is our policy to forego profit distributions until all key investments have been financed and sufficient liquidity is available. Another priority in this context is achieving a general increase in the target company’s investment ratio. We also set great store on developing the restructured company’s future talent, and therefore strive to maintain a high training ratio (trainees to employees).
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