In December 2025 Dutch lingerie retailer Hunkemöller initiated a controversial restructuring that introduced ‘creditor-on-creditor violence’ to the European market, which has sparked a major legal battle. Facing high debt and low earnings, the company has utilised a Liability Management Exercise (LME) to secure new financing.

This deal allowed a majority group of lenders to provide capital, which effectively subordinated and diluted the holdings of a dissenting minority group. This aggressive tactic, common in the U.S. but rare in Europe’s more collaborative lending environment, has sparked considerable alarm among investors.

By bypassing the need for unanimous consent, Hunkemöller successfully improved its liquidity without filing for formal insolvency. This move has potentially transformed the European credit landscape, signaling that the ‘every-man-for-himself’ tactics are no longer exclusive to American markets, ending Europe’s tradition of creditor consensus. 

Read more here.

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Latvian-based SmartLynx Airlines has ceased all commercial operations, ending 33 years as a leading European ACMI and charter provider. The shutdown follows a rapid spiral into insolvency, occurring just one month after the carrier was sold by Avia Solutions Group to its management and Dutch investment firm Break Point Distressed Asset Management.

While parent SmartLynx Latvia faced debts exceeding €238 million, the fate of its sister carriers in Estonia and Malta initially appeared separate under ASG ownership. However, recent reports indicate ASG subsequently divested these subsidiaries to the same Dutch fund. 

Estonian authorities have since revoked SmartLynx Estonia’s operating license, effectively grounding the unit. This collapse has left hundreds of employees facing unpaid wages and stranded crew members abroad. 

Read more at Flight Global

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Preckel Automobile, a German car dealership group, has filed for insolvency as weak electric vehicle sales have seriously undermined its business, leaving around 500 jobs at risk. The company is closing three branches in Düsseldorf, Solingen, and Heiligenhaus as part of cost-cutting measures, though other locations will continue operating for the time being. 

The insolvency proceedings were initiated at the Krefeld District Court under a preliminary self-administration process. A major factor in the downturn is that demand for electric cars has fallen well below expectations due to high purchase costs, uncertain resale values and insufficient charging infrastructure, while manufacturers focus on high-priced models that struggle to attract buyers.

The case highlights a growing crisis within the European automotive retail sector as traditional dealers struggle to balance the management of stagnant EV inventory and rising operational costs. 

Reported here at Blackout News

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2025 saw German business insolvencies climb to their highest level in a decade, with 23,900 companies filing for bankruptcy - an 8.3% increase from 2024. This reported surge reflects the serious toll of a prolonged economic downturn, high energy costs, and ongoing bureaucratic burdens.

While all sectors felt the impact, the manufacturing and trade industries saw the sharpest increases and micro-enterprises (with fewer than 10 employees) accounted for over 81% of all cases. The financial damage is estimated at €57 billion, affecting approximately 285,000 employees.

Looking ahead to 2026, experts warn that while government infrastructure investment may offer a slight buffer, the trend remains "dynamic." Without significant structural reforms to address eroding competitiveness and high personnel costs, the insolvency wave is expected to persist through the first half of the new year.

Read more here

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