German business avoids insolvency in UK move

A struggling German business is moving its operations to Brighton in an attempt to take advantage of UK insolvency rules.

SCHEFENACKER , the world's biggest maker of car mirrors, is moving because UK insolvency rules allow it to strike a deal with creditors, which should give the business some time to turn itself around and save 7,900 jobs.

German banks had sold off most of their SCHEFENACKER loans to UK hedge funds that now own 90% of the company's credit.

Under German rules the company faced insolvency, as Q3 results breached a bond covenant. Minority creditors could have forced the company into insolvency.

Debt for equity will be swapped to save the company.

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