Guarantees for SME bonds?

D.he corona pandemic is also putting issuers of so-called SME bonds under pressure. The manufacturer of fastening technology for wood, J. F. Behrens, is threatened with bankruptcy. In the first half of the year, sales fell by almost 12 percent to 54 million euros compared to the same period in the previous year, mainly in April and especially in countries badly affected by the pandemic such as America and Italy. Even if sales rose again in June, the net loss tripled to 1.2 million euros. Despite the recovery, Behrens does not expect to achieve the original plan. At the moment, however, reliable forecasts are hardly possible.

Behrens has two bonds outstanding, one of which, with a volume of around 16 million euros, matures in November. The issue of a new bond, as in the previous year, does not seem to be possible at present. That should follow in the fourth quarter. Nevertheless, at the beginning of July, the company submitted an application to the Federal Ministry of Economics (BMWi) for a guarantee for a new bond or a silent participation from the Economic Stabilization Fund (WSF). Based on positive feedback, one is now confident of receiving the latter in the single-digit millions.

The WSF was probably unable to guarantee a bond because it is only intended for bond volumes of 100 million euros or more. Just a few weeks ago, the BMWi initially rejected the contrary request of the association of capital market-oriented SMEs. “Bonds can be placed on the capital market quickly and inexpensively,” argues association president Ingo Wegerich. “Medium-sized companies could be introduced to this via a guarantee.” Some observers doubt whether a possible abundance of silent participations is more effective. Therefore, the last word on this matter may not have been spoken here.

Only a few bonds from medium-sized companies are due in the current year, for example those from the food manufacturer Schneekoppe with a volume of around 1 million euros in September. According to an earlier announcement, the repayment is to be made from liquidity and an additional bank loan. It can be assumed that the development for Schneekoppe during the lockdown was not favorable. With a turnover of around 3.3 million euros in the previous year, one million is a lot of money. A five million loan from luxury mansion provider Timeless Homes matured in June. In July, he tried unsuccessfully to persuade the creditors to extend the maturity until 2022. How things will go on is not known. Neither company was available for comment on Monday.

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