Brussels, 15/12/2000 (Agence Europe) - The European Commission closed with a final positive decision the formal investigation procedure opened against the State aid for DM 143.5 million granted to the SKET Walzwerkstechnik GmbH 9SKET WT) a German engineering company, established in Magdeburg (Land of Sachsen-Anhalt) that designs and arranges rolling mills at the world level. With a staff of 160 people, this company, which had taken on the design activities of the conglomerate SKET SMM after it bankruptcy, depends entirely on suppliers and does not have any physical production capability.
In June 1997, German passed on to Brussels the detail of the aids to restructuring in favour of the company, including a restructuring plan; for lack of complete information and private investors, the Commission saw itself forced to open a formal investigation in November of the same year. Furthermore, doubting the long-term viability of the company, the Community executive has also asked the German government to explain the way in which SKET WT intended to honour the old contract of SKET SMM. In April 1998, SKET WT was privatised following a call for tender and Munchmeyer Petersen GmbH & Co had taken control. The Bundeanstalt fur vereinigungdsbedlingte Sonderaufgaben (BvS), German office responsible for privatisation, paid it a total of DM 118.5 million in State aid for its restructuring so that it could be sold. Furthermore, the Land of Sachsen-Anhalt paid it DM 25 million under the system of aid that had been previously approved. The contribution from MPC towards the restructuring of the company totals, for its share, DM 36.2 million.
The Commission approved the aid paid, feeling that the implementation of the restructuring plan should enable to re-establish the long-term viability of the company. Furthermore, the distortions to competition are limited because the market in question does not seem to be characterised by an overcapacity, and the beneficiary is presently reducing its capacity. Finally, the private investor concerned is heavily contributing towards the restructuring. As a result, the conditions imposed by the guidelines for State aid for the safeguarding and the restructuring of companies in difficulty are fulfilled.