German internet travel giant Unister filed for insolvency on Monday following the deaths of two of its co-founders.
Thomas Wagner and Oliver Schilling were onboard a plane that crashed in Slovenia on Thursday.
Unister, the struggling owner of such websites as ab-in-den-urlaub.de and travel24.de, ranks among Germany’s largest brokers of package holidays. The firm now faces an uncertain future.
“We won't be able to replace Thomas and Oliver. But we will preserve and continue their legacy with dignity,” the Leipzig-based company said in a statement posted on its website.
That legacy, a commercial empire with more than 40 portals and 1,100 employees, now is in the hands of Lucas Flöther, a partner at the law firm Flöther & Wissing and the insolvency administrator.
For the moment, Unister’s internet sites are continuing business as usual. Mr. Flöther said the websites are managed by independent firms that aren't affected by the insolvency.
The provisional insolvency proceedings allow the Unister holding company to continue operations in this difficult phase. Lucas Flöther, Insolvency administrator, Flöther & Wissing
Mr. Wagner, the chief executive of Unister, was returning from Venice to Leipzig with Mr. Schilling when their plane crashed. Two other people died in the crash.
According to Manager Magazin, Mr. Wagner had hoped the trip to Italy would assure a fresh loan for his company. The local police in Slovania made no comment about reports that a briefcase containing several million euros was found on board the plane. The Bild newspaper reported that cash was found at the crash site. Daniel Kirchhof, a Unister co-founder and partner, said he knew nothing of such reports and assumed that Mr. Wagner had been on a business trip.
Unister has been in financial difficulties. In January, Handelsblatt reported that the firm’s liquidity hinged on loans of up to €50 million from the insurance giant Hanse Merkur. Repayments were due to begin in October, but nothing had been paid. Mr. Wagner’s plan was to find a powerful investor to inject fresh capital into Unister. But prominent investors such as broadcaster Pro Sieben Sat 1 and most recently CTS Eventim, a ticketing firm, refused his overtures.
Unister made a name for itself with vacation-related websites. With successful portals such as ab-in-den-urlaub.de and fluege.de, the company is one of the largest German vacation providers. But the growth was fueled by high marketing expenditures.
Ever since the business year 2011, Unister has refrained from issuing a consolidated financial statement. The annual financial statement for 2013, which has been obtained by Handelsblatt, showed a shortfall of €27.7 million – including over-indebtedness.
Mr. Wagner told Handelsblatt in January that the indebtedness was related to high startup expenses for his websites. The subsidiaries would generate a profit only when they were sold, he said. Last May, he was able to sell a good-sized comparison website for the first time. The financial services provider JDS purchased the online provider geld.de for a two-digit sum in the millions of euros, according to individuals familiar with the negotiations.
Mr. Flöther says he has already contacted financial backers, suppliers and customers and informed them of the situation.
“The provisional insolvency proceedings allow the Unister holding company to continue operations in this difficult phase and to maintain its entrepreneurial unity over the long term,” Mr. Flöther said.
“Above all, the provisional insolvency offers short-term financial security,” he said. “On this basis, Unister can restore its stability over the long term.”
Mr. Wagner was born in Dessau in the former East Germany and co-founded Unister in Leipzig in 2002, originally as an exchange system for students. The startup grew quickly and in only a few years became an internet empire with 40 national and international websites.
But in 2012, Unister was the object of criminal investigations. Mr. Wagner was briefly held in custody when he and three other managers were accused of, among other things, illegal insurance deals and tax evasion. Unister has consistently disputed the charges. No trial has been held up to now because the Leipzig District Court is examining a further set of accusations.
Miriam Schröder is based in Berlin and covers the startup scene. To reach the author: [email protected]