Brussels, 02/11/2000 (Agence Europe) - The European Commission has approved the granting of 7.42 million euro aid to restructuring in favour of Schiffsanlagenbau Barth GmbH (SAB), a German company active in the metal working and machine building sectors in the Land of Mecklenburg-Vorpommern. The company owned since December 1998 by Estoerfer Machinen Fachhandels GmbH Holding (EMF), has been undergoing restructuring since then. The process cover s a period of three years.
The aid granted by te Bundensanstalt fur Vereinigungsbwedingte Sonderaugaben (BvS0) and the Land of Mecklenburg-Vorpommern was examined from the point of view of the guidelines on aid to rescue and restructuring that must respect three essential criteria: i) restructuring must enable to re-establish the long-term viability of the company, ii) aid must not lead to distortions in competition within the common market, iii) the aid must be proportionate to the costs and benefits of restructuring. After assessment, the Commission felt that the aid fulfilled these requirements. In fact SAB could considerably reduce its losses and the restructuring plan should enable it to find long-term profitability. Furthermore, SAB will transfer market capacity characterised by overcapacity (steel construction) and a market where this problem has not been signalled (stainless steel products in the sector from machines in the food processing industry and the fish meal producing factories). This measure will counter the prejudicial effects on the competitors and avoid undue distortions to competition stemming from the aid. Finally, the Commission notes that EMF will shoulder a significant part of the total restructuring cost and that the State aid was proportionate to the costs and benefit it brought.