Kelheim Fibres prepares for orderly production phase-out by end of March 2026

Kelheim Fibres had begun preparations for an orderly phase-out of production by the end of March 2026, following the withdrawal of a potential investor from a previously agreed transaction.

In early November 2025, Munich-based financial investor LEO III Fonds had signed a notarial purchase agreement for Kelheim Fibres. The transaction was integrated into the company’s ongoing self-administered insolvency proceedings. However, around three weeks later, Kelheim Fibres confirmed that the investor had withdrawn from the agreement.

In a written statement, the company explained that the transaction process could not be completed due to the non-fulfilment of key closing conditions. In particular, binding volume commitments from several major customers for 2026 were not secured. As a consequence, the investor withdrew, as a viable and sustainable business model could not be ensured.

Despite broad support from the majority of customers and restructuring measures that had already been successfully implemented, Kelheim Fibres stated that the currently binding order volume was insufficient to economically justify a regular continuation of operations beyond 31 December 2025.

At the same time, the company indicated that a potential strategic investor had entered the M&A process at very short notice. According to Kelheim Fibres, this party had not previously been involved and was now assessing a possible investment in or acquisition of the business. The evaluation was described as being at a very early stage, with the outcome still uncertain. Management confirmed its support for any realistic option aimed at continuing operations.

Kelheim Fibres also underlined that employees would continue to be informed regularly and transparently about developments. Management noted that both a successful orderly phase-out and any potential transaction would depend to a significant extent on employee commitment, support, and cooperation.

Kelheim Fibres produces around 35,000 tonnes per year of specialty viscose fibres, primarily used in feminine hygiene products, specialty papers, and technical applications. The company is based in Kelheim, Bavaria, Germany.