Insolvency shock: DRK Braunschweig is fighting for a future and 450 jobs!

Insolvency shock: DRK Braunschweig is fighting for a future and 450 jobs!

In a worrying turn of events, the German Red Cross (DRK) in the Braunschweig/Salzgitter district had to file for bankruptcy. This decision was announced on Wednesday, June 18, 2025 and affects more than 450 employees. However, the board of the district association, Nico Seefeldt Kazazi, is optimistic and sees good opportunities for a sustainable restructuring, as the business will initially continue to run under the supervision of a property manager, while a restructuring concept is already in progress. The bankruptcy filing became necessary after the economic burdens caused by the corona pandemic and the increased energy costs as a result of the Russian attack on Ukraine had caused severe problems for the DRK.

The district court has ordered bankruptcy under self-administration, which gives the company the opportunity to reorganize under its own management and under the supervision of an administrator. The employees' salaries are secured by insolvency benefits from the employment agency, so that the workforce does not immediately have to worry about their existence. The DRK has thus proven to be a stable employer that has generated around 20 million euros in sales in recent years and operates a variety of facilities, including advice and youth centers, care facilities and daycare centers.

Background to bankruptcy

The DRK's prevailing economic difficulties result from several factors. A planned sale of a large property that was supposed to bring fresh money into the coffers was unexpectedly delayed. In addition, the closure of a nursing home in 2023 had already revealed the first financial difficulties. In the region there are not only companies suffering from the DRK; In 2023, a total of around 110,200 bankruptcies were recorded in Germany, which represents a significant increase compared to previous years, especially in the service sector, which had the largest number of bankruptcies at 59%. North Rhine-Westphalia, where the DRK district association is located, reported the highest number of corporate bankruptcies, which is putting additional strain on the local economy.

The DRK subsidiaries affected include the “care and support” areas and the “Springboard” project. The DRK, founded in 1948, is not alone - the pressure on many social and non-profit organizations is increasing. Nevertheless, the management remains in office and is closely involved in the planned restructuring measures in order to get the company back on track and support those affected.

A look at the future

The tense financial conditions make it clear that the path back to stability will by no means be easy. However, the Kazazi board emphasizes that there is a likelihood of a successful restructuring. The DRK expects the self-administration process to give it a decent chance of taking the necessary steps towards economic recovery. The committed support of employees is important in these times in order not to let the social fabric that has been built up in the region over many years be undermined.

It remains to be seen whether the DRK can take the necessary steps to overcome these crises. But the decision to restructure under self-management could be the key to revitalizing social responsibility in the region. The hope remains that the diverse services of the DRK, which are of great importance to many in the region, can be maintained in the future.

For more information about insolvency and its evolution, please visit:
NDR, Picture and Statista.