Gerresheimer Faces Accounting Crisis and Index Expulsion

Gerresheimer's delayed 2025 report triggers SDAX removal, a 73% stock crash, and a €240M impairment. An accounting probe and liquidity talks with banks intensify the crisis.

The delayed release of its annual report has triggered a chain of severe consequences for packaging specialist Gerresheimer. The company is set to be removed from Germany's SDAX index on March 31, a direct result of its postponed financial statements for 2025, which are now not expected until June. This fundamental uncertainty has devastated shareholder value, with shares closing at €20.44 on Friday, representing a staggering 73% decline over the past twelve months.

A Web of Accounting Irregularities

At the heart of the turmoil are significant accounting issues currently under investigation by a second external auditing firm. The probe focuses on "bill-and-hold" agreements from 2024 and 2025. Management has conceded that employees may have knowingly circumvented internal controls and IFRS accounting standards by recognizing revenue before the physical delivery of goods. In response to these specific accounting gaps, German financial regulator BaFin has significantly intensified its own examination.

Compounding the problems are announced non-cash impairment charges of up to €240 million. These writedowns primarily relate to technology projects at its Sensile Medical subsidiary and its manufacturing facility in Chicago Heights, USA. The US plant is slated for complete closure by the end of 2026, with production being relocated.

Liquidity Pressures and Market Speculation

The delayed reporting has breached contractual information obligations to Gerresheimer's lenders. The executive board is now engaged in intensive negotiations with banks to extend deadlines and secure its credit lines. The annual general meeting and the Q1 2025 results have also been casualties of the disrupted schedule.

To alleviate substantial financial pressure, the company is reportedly planning the sale of its US subsidiary Centor, with investment bank Morgan Stanley overseeing the process. Meanwhile, unconfirmed market rumors are causing share price volatility, including speculation that US conglomerate Silgan Holdings is considering a takeover bid of €41 per share. However, the situation remains highly risky for investors until the audited financials are presented in June and bank talks conclude.

The imminent forced technical selling by index funds following Tuesday's SDAX expulsion is expected to fuel further volatility in the coming trading sessions.