Lenzing withdraws from Heiligenkreuz and seeks a new owner for the site

End of fiber production in Heiligenkreuz and Grimsby

In Heiligenkreuz in Burgenland and at the Grimsby site in England, fiber production will be phased out by the end of 2027, according to a company statement issued on Monday evening. In Heiligenkreuz, 285 employees are affected, for whom an existing social plan applies. At the end of 2025, the Lenzing Group employed a total of around 7,700 full-time staff worldwide, meaning roughly one in four jobs is at stake.

Kasperkovitz spoke of a „schwierigen, aber notwendigen Entscheidung". The aim was to „Wettbewerbsfähigkeit und Profitabilität der Lenzing Gruppe nachhaltig verbessern, die Kapitalrendite erhöhen und das Unternehmen für langfristiges Wachstum in höherwertigen Marktsegmenten positionieren". The program is named „Grow Nonwovens, Reset Textiles" and is part of a strategic realignment already underway since last year.

Strategy program „Grow Nonwovens, Reset Textiles"

The Chairman of the Supervisory Board rejected the impression that this was a pure closure and cost-cutting program. The plans are rather underpinned by a „umfassenden Refinanzierungsvereinbarung mit den wesentlichen Kreditgebern", said Kasperkovitz. Shareholders and other financiers are providing up to 600 million euros in fresh capital in total.

As part of these financing agreements, a capital increase with subscription rights totaling up to 300 million euros is also planned. This requires approval at an extraordinary general meeting, which according to the company is expected to take place on or around September 25.

Shareholder structure and capital increase

The largest shareholder of Lenzing AG is the Austrian industrial holding company B&C with 37.25 percent of the shares. 37.74 percent are in free float, 10.01 percent are held by the US investment bank Goldman Sachs. In 2024, B&C had given up its majority; the Brazilian pulp company Suzano took over a 15 percent stake and is syndicated with B&C. Suzano also holds a call option on a further 15 percent until 2028.

According to the company, the program is supported by the main shareholders B&C and Suzano as well as by Oberbank. Kasperkovitz emphasized that the measures should not be understood as a „Cost-Cutting-Programm", but as an investment in profitable business areas. The confidence of the lenders is reflected in their willingness to provide up to 600 million euros.

It had already become known in September 2025 that Lenzing intended to cut 600 positions alone in the administrative area. According to earlier information, 267 employees in administrative functions are affected, including in England and Indonesia. The target figure is intended to save 45 million euros in this sub-area; according to the company, 25 million euros have already been saved. Overall, the savings are expected to reach around 120 million euros.

Financially, the measures weigh significantly. In the course of the site consolidation in 2026, Lenzing AG expects impairments of long-term assets, in particular property, plant and equipment, of up to 150 million euros. These non-cash writedowns will have a negative impact on Group EBIT and Group net income in 2026, but have no effect on EBITDA.

Financial impact of the restructuring

In addition, restructuring provisions in connection with personnel measures of up to 40 million euros are expected to burden EBITDA in 2026. When asked, Kasperkovitz said that the 2,000 positions were those „die es weniger werden sollen" – including previously announced reductions.

Parallel to the end of fiber production in Heiligenkreuz and Grimsby, a sales process is already underway at Lenzing for the Indonesian viscose site PT South Pacific Viscose. Fiber production at these sites will involve „schwierige, aber notwendige Entscheidungen", Kasperkovitz continued. The company is aware that the planned phase-out „unsere Mitarbeitenden betrifft".

Political reactions from Burgenland

Burgenland's Governor Hans Peter Doskozil (SPÖ) assured on Monday evening that the state would „nicht im Stich lassen" the site and the workers of the plant in Heiligenkreuz. The group's decision was a „für das Südburgenland schmerzhafte Weichenstellung der Konzernverantwortlichen", which cannot be influenced politically, Doskozil lamented. He also pointed to the economic significance of the plant as well as to investments and a positive development of operating results in the first half of 2026.

„Dabei sei versichert worden, dass die Produktion bis Jahresende gesichert sei und möglicherweise darüber hinaus fortlaufen könnte, ‚sofern es für einen geordneten Übergang und eine Fortführung in neuer Konstellation hilfreich ist'", it was said from the Governor's office. The Governor stressed that everything would be done to create a „verlässliche und positive Perspektive für die Region und die betroffenen Arbeitnehmer".

The Burgenland ÖVP also reacted to the announcement. State party chairman Christoph Zarits spoke in a release of a „dramatischen Nachricht" and emphasized: „Ein Sozialplan allein ist dafür keine ausreichende Antwort." Securing the site and jobs must be the top priority.

According to the company's own information, it is already in talks with employee representatives. „Derzeit führen wir konstruktive Gespräche mit den Arbeitnehmervertretern über die notwendigen Maßnahmen im Rahmen der bestehenden Sozialpläne und geltenden lokalen Rahmenbedingungen", said Kasperkovitz. The existing social plan applies to the 285 employees in Heiligenkreuz.

Observers view the move as one of the biggest cuts in Lenzing's recent corporate history. The Upper Austrian fiber manufacturer, which produces cellulose fibers for the textile and hygiene industries, among others, intends in future to focus more strongly on the higher-margin nonwovens business and to reorganize the traditional textile business.

With the parallel search for a new owner for Heiligenkreuz and the already launched sale of the Indonesian plant PT South Pacific Viscose, the group's global production structure is fundamentally changing. Whether and in what form the 285 jobs in Heiligenkreuz can be retained under new ownership is currently open.

The planned capital increase of up to 300 million euros and the broadly based refinancing are intended to financially secure the restructuring. Shareholder approval at the extraordinary general meeting at the end of September is considered the next important milestone on the path of realignment.

The Burgenland Governor intends to hold talks with group management and potential investors in the coming weeks to secure the future of the site. The social partners have also been convened to advise on the concrete effects for the affected employees.

„Jetzt muss alles darangesetzt werden, diese Arbeitsplätze und den Standort zu sichern", said Doskozil. The coming months are likely to show whether the search for a new owner for Heiligenkreuz will be successful and how many of the 2,000 positions being cut worldwide can be cushioned by the structural change.