Völpel – A hidden organic champion seeking investors

You won’t find the name Völpel on the packaging of organic spices, herbal teas or dried apple rings, but without this family-run business, many of these packets would remain empty. The company has recently run into financial difficulties and has been forced to file for insolvency. One reason for this is soaring energy costs. However, there is a strong desire to ensure that this highly specialised ‘hidden champion’ remains part of the organic food sector, and it is therefore seeking strategic partners. The prospects are good: the company brings nearly 80 years of expertise, a loyal customer base and spare capacity at two modern production sites. The insolvency administrator is confident. Operations are continuing without restriction, ensuring full delivery capacity. At the same time, the search for investors is underway.

Völpel GmbH & Co KG’s state-of-the-art plant in Zittau, ZiFood, is also affected by the insolvency proceedings but continues to operate whilst the search for investors is underway. (Photo: Völpel)

A tradition-rich company with a bright future

Völpel GmbH & Co. KG in Königsmoos (founded in 1948) and, since 2021, ZiFood Trockenprodukte GmbH in Zittau (Saxony) are key partners for organic growers and suppliers to organic food manufacturers, offering a range of well over 100 different organic ingredients. From pineapples to onions, the companies process medicinal plants, herbs, spices, vegetables and fruit. The fresh produce is gently dried using modern equipment, refined and blended to the customer’s individual specifications. The Zittau plant is equipped with specialised machinery for vacuum drying (puff drying), infusion and laser sorting – facilities that are something of a rarity across Europe.

After the company was forced to file for insolvency for both plants at the end of September, operations have been stabilised and are continuing. “We received an enormous amount of support from customers and suppliers immediately after filing the application, meaning that our ability to deliver is fully guaranteed and we can continue operations seamlessly,” explains the provisional insolvency administrator, lawyer Dr Alexander Zarzitsky.

At the Völpel plant in Königsmoos, Bavaria, around 60 employees work to manufacture the extensive range of dried products for the approximately 200 customers in Germany and abroad. (Photo: Völpel)

A regionally based link between organic farmers and producers

In 1989, Völpel began processing organic products and today offers more than 90 per cent of its goods under the EU-Bio, Bioland, Demeter, Naturland, Bio Suisse and FSSC 22000 organic certifications. Following the peak in demand for organic food during the COVID-19 pandemic, 2022 saw a decline in consumer spending, rising energy costs and weather-related crop failures. These factors led to increasing financial strain and ultimately to insolvency. Völpel employs a total of around 80 staff and supplies approximately 200 customers both at home and abroad.

 

The ‘hidden champion’ is to be saved

The high-bay warehouse is part of the specialist processor Völpel. (Photo: Völpel)

The insolvency administrator speaks very highly of Völpel: “The company is on a sound footing. Direct links with farmers that have developed over decades, stable customer relationships and long-lasting plant technology form a solid foundation for the future.” German Völpel, the founder’s grandson and managing director since 2008, is also confident about the future of the family business. “We are market leaders for a number of products. Our long family tradition, our experience and our network of suppliers and farmers must not be lost. That would create a gap in the supply chain that would be difficult to fill.”

Under his leadership, significant investment has been made in the sustainability and modernisation of the company, in warehouses, production lines and capacity, as well as in photovoltaic systems and a combined heat and power plant with heat recovery to optimise energy use in the energy-intensive drying processes. Nevertheless, soaring energy costs coupled with falling demand for higher-priced organic ingredients – caused by a challenging market environment – have become a financial trap for Völpel. Nevertheless, German Völpel looks to the future with optimism, is delighted by the support of customers and suppliers, and is certain: “With the organic market growing again and the right partners, we will remain by the side of producers and organic manufacturers as intermediaries.”

 

Extensive search for investors launched – first positive results

A small selection from the product range, comprising 90 per cent organic items. (Photo: Völpel)

The management, together with the provisional insolvency administrator and the specialist consultancy firm HCM Human Consult Management GmbH & Co.KG, has initiated a targeted investor search process. The aim is to make optimal use of existing capacities and to place further growth on a solid footing, according to the press release. In collaboration with an investor, the existing strengths are to be expanded. The aim is to achieve planning certainty for employees and all stakeholders, if possible, before the end of this year, explains HCM Managing Director Fabio Octavio Mathias. “Through market access and financial strength, a future investor can provide exactly what the Völpel Group needs to utilise its state-of-the-art facilities to full capacity and ensure a successful long-term future,” he emphasises.

Author: Karin Heinze, BiO Reporter International

Source: Press release, interview with German Völpel