The construction and real estate service provider, Steiner AG, has filed for creditor protection due to a severe liquidity shortage. The Zurich-based company submitted an application for a provisional debt restructuring moratorium to the Zurich District Court. This financial crisis has prevented the company from paying its bills, leading to this action.
Steiner’s financial difficulties became apparent when a dispute with the Wetzikon Regional Hospital intensified. The hospital was in construction by Steiner, worth over 200 million Swiss francs. However, problems arose in April when the hospital faced financial difficulties that led to a prohibition on providing assistance from the canton of Zurich. As a result, Steiner terminated the contract with the hospital.
The dispute between Steiner and the hospital centered on payment issues. The hospital claimed that Steiner had not been transparent about subcontractor costs and payments, resulting in outstanding bills and financial difficulties for subcontractors. On the other hand, Steiner argued that the hospital lacked liquidity to finance new building projects, leading to contract termination.
Apart from these issues with hospitals, Steiner’s challenges are related to its general contracting business which is liquidity-intensive and prone to conflicts. Recently, Steiner made a decision to focus more on real estate development than building projects which has contributed significantly to its financial difficulties.
The application for creditor protection will allow Steiner undergoes debt restructuring process that aims at avoiding bankruptcy during this period; it will operate under supervision of trustee ensuring that all creditors are treated equally. This restructuring would help transitioning Steiner from general contractor to real estate development company resolving its financial challenges in a better way possible manner.
In conclusion, it is evident that steering AG is facing significant challenges due to various reasons such as disputes with clients and intense competition in their industry; therefore it is important for them seek legal advice from lawyers experienced in debt restructuring and bankruptcy law before making any decisions about their future actions towards their creditors or potential investors .
