Prokon insolvency fallout
January 23, 2014
Troubled northern German wind energy company Prokon said Thursday it considered selling some of its wind farms to prove that the company had additional assets and would be able to improve its financial situation.
CEO Carsten Rodbertus spoke of "a certain part of our portfolio" and did not give a concrete number during a press conference at Itzehoe where the company is based.
Preliminary insolvency administrator Dietmar Penzlin said he was confident that the firm's core wind energy business could be continued.
He promised to do all in his power to keep the company alive while an in-depth analysis of its financial situation was carried out.
All money lost?
Prokon filed for insolvency on Wednesday following the massive withdrawal of capital by worried investors.
A plea by Prokon management that they keep their money in the company was only partly successful.
Via the company's website, Prokon said just over half of them had agreed to support the firm, but that was not enough to avert insolvency.
"This is no way means it's 'lights out' for Prokon," the company insisted.
8 percent
Prokon's business model included offered investors participation certificates with annual interest rate returns of up to 8 percent.
That had long drawn criticism from consumer protection groups which questioned its viability.
Germany's new grand coalition government in Berlin said those doubts had turned out to be well-founded.
Call for regulation
"The Prokon case has shown once again there are still grey areas in capital markets which need regulating," Justice Minister Heiko Maas commented.
Following a strategy meeting outside Berlin, German Chancellor Angela Merkel promised that cabinet ministers would come up with proposals on what and how to regulate.
"You always have to ask how safe certain financial products are, especially when small private investors are able to buy them," she argued.
Prokon operates 50 wind parks in Germany and Poland and was set up in the 1990s. Its advertising campaign focused on retail investors.
It said more than 75,000 investors had put a total of nearly 1.4 billion euros ($1.9 billion) into Prokon.
hg/ipj (dpa, Reuters)