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DIY chain Praktiker slides into insolvency

Are Germans losing interest in tool belts and hammers? One of the country's biggest DIY supply chains Praktiker declared itself insolvent on Wednesday night, with nearly 20,000 jobs now at risk.

DIY chain Praktiker slides into insolvency
Photo: DPA

The chain has more than 300 shops in Germany and nearly 130 in eight other countries, but the majority of the jobs are domestic.

Praktiker has been in the red for years, after a failed discount campaign plunged it into crisis. Last autumn, new chairman of the board Armin Burger set out a plan to secure its finances but the first quarter of this year resulted in more losses.

It is thought the entire DIY industry suffered from the long winter and the resulting late start to the spring season.

These considerations negated the efforts of the management, the board said in a statement. “This has pushed the company into a strained liquidity situation,” it said, adding that it was not possible to find dependable financing for a restructuring.

The Praktiker group also owns the far more profitable Max Bahr chain. Burger recently closed a number of Praktiker shops, closed down operations in a number of countries, and turned some Praktiker stores into Max Bahr shops. But this was not enough, and the money has now run out, the board told shareholders on Wednesday.

An application for insolvency will be submitted to the relevant authorities shortly, the board said. The Max Bahr shops will not be affected, and most of the Praktiker shops abroad will also continue to operate.

The Local/DPA/hc

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ENVIRONMENT

Sweden’s SSAB to build €4.5bn green steel plant in Luleå 

The Swedish steel giant SSAB has announced plans to build a new steel plant in Luleå for 52 billion kronor (€4.5 billion), with the new plant expected to produce 2.5 million tons of steel a year from 2028.

Sweden's SSAB to build €4.5bn green steel plant in Luleå 

“The transformation of Luleå is a major step on our journey to fossil-free steel production,” the company’s chief executive, Martin Lindqvist, said in a press release. “We will remove seven percent of Sweden’s carbon dioxide emissions, strengthen our competitiveness and secure jobs with the most cost-effective and sustainable sheet metal production in Europe.”

The new mini-mill, which is expected to start production at the end of 2028 and to hit full capacity in 2029, will include two electric arc furnaces, advanced secondary metallurgy, a direct strip rolling mill to produce SSABs specialty products, and a cold rolling complex to develop premium products for the transport industry.

It will be fed partly from hydrogen reduced iron ore produced at the HYBRIT joint venture in Gälliväre and partly with scrap steel. The company hopes to receive its environemntal permits by the end of 2024.

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The announcement comes just one week after SSAB revealed that it was seeking $500m in funding from the US government to develop a second HYBRIT manufacturing facility, using green hydrogen instead of fossil fuels to produce direct reduced iron and steel.

The company said it also hoped to expand capacity at SSAB’s steel mill in Montpelier, Iowa. 

The two new investment announcements strengthen the company’s claim to be the global pioneer in fossil-free steel.

It produced the world’s first sponge iron made with hydrogen instead of coke at its Hybrit pilot plant in Luleå in 2021. Gälliväre was chosen that same year as the site for the world’s first industrial scale plant using the technology. 

In 2023, SSAB announced it would transform its steel mill in Oxelösund to fossil-free production.

The company’s Raahe mill in Finland, which currently has new most advanced equipment, will be the last of the company’s big plants to shift away from blast furnaces. 

The steel industry currently produces 7 percent of the world’s carbon dioxide emissions, and shifting to hydrogen reduced steel and closing blast furnaces will reduce Sweden’s carbon emissions by 10 per cent and Finland’s by 7 per cent.

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