Swiss Dairy Food gets government bailout
The Swiss government and banks are to pump SFr160 million ($107 million) into the troubled dairy firm, Swiss Dairy Food (SDF), to save it from collapse.
The second largest dairy in the country said it had avoided bankruptcy by means of a bank credit of SFr89 million.
A further SFr70 million was expected to come from the government.
SDF announced it had gone into receivership and would be seeking to sell off viable parts of the operation.
“The board of management and the directors are aware that the decision that has been taken will have appalling consequences for employees and serious repercussions for the Swiss dairy industry as a whole,” SDF said in a statement.
It said the bank credit would enable it to keep production going and continue to employ two-thirds of its staff of 1,600.
Centres closing
The group said it expected to close two centres of operations in Gossau and Lausanne, and to sell off all other production centres.
Chairman of the board Hans Räber said he regretted that no other alternatives were open to SDF.
“In Switzerland there is only room for one independent dairy, which can compete with foreign competition,” Räber told a news conference.
SDA works with approximately 7,000 farmers in Switzerland who rely on the dairy for income. SDF said that while employees’ wages were guaranteed by the bank credit, farmers could expect to have to wait for their money.
swissinfo with agencies
SDF is to receive a bank credit of SFr89 million.
The government is to pay SFr70 million for milk produced in August and until September 22.
The company expects to lose one third of its 1,600-strong workforce.
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