Netherlands: Swets Files For Bankruptcy

Note: We’ve updated this post multiple times with additional material. Look for the updates below.
A story on the German publishing industry web site boersenblatt.net (in German) reports that Netherlands-based Swets (Swets Information Services B.V.) is insolvent and has filed for bankruptcy. We’ve reached out the company for comment. With the caveat the mechanical translation is far from perfect, we do learn a bit more by translating the boersenblatt.net article into English using Google Translate.

• The company was granted bankruptcy protection by a court in Amsterdam.

• “The company is dismissed for the duration of the arrangement of its payment obligations to creditors (mainly publishers so).”

Precisely what this will mean for customers, publishers, and others is to be determined. We will update as more details are learned. For background about the company including financials for 2013, their latest annual report became available about one month ago (PDF). Section 3.9 of the annual report is titled “Growing Concern” and offers a discussion of some issues that likely played a role in today’s bankruptcy filing. This section concludes with the following paragraph:

As per the end of 2013 as well as per the end of Q1 and Q2 2014, Swets Group failed to meet its covenant requirements related to the long term financing. As a consequence of this breach the syndicate and Intermediate Capital Group (both indicated as ‘the lenders’) are entitled to demand immediate repayment. At the moment of signing of the financial statements 2013, the lenders have not accelerated repayment of any of the loans. Since Swets Group is currently unable to fulfill such a potential demand, there is a material uncertainty regarding the continuity of Swets Group and its subsidiaries.

Swets says they have customers in 160 nations, offices in 23 countries, and employs over 570 people. The annual report adds that the company has 0ver 8,000 customers worldwide representing approximately 800,000 subscriptions.
This mechanical translation of a report from RTL.nl has a bit more.

UPDATES

UPDATE 11 (Sept 24) EBSCO Posts: Protecting Your Library Amidst the Swets Crisis
UPDATE 10 (Sept 24) Official News Release: Swets Information Services B.V. declared bankrupt
Below is the first official statement we’ve seen from the company since it declared bankruptcy two days ago. The statement is also available at this url.

Following the suspension of payment for Swets & Zeitlinger Group BV, granted by the court in Amsterdam on 19 September, the Management  team, together with Mr J.L.M. Groenewegen (CMS),  the appointed administrator, have been working tirelessly to investigate alternatives for the business. Unfortunately, concrete alternatives to sell the business as a whole have not materialised and due to these developments Swets Information Services B.V. filed for bankruptcy on 23 September 2014. The court of Amsterdam honoured this request and as per 23 September 2014 Swets Information Services B.V. is declared bankrupt.
Mr. J.L.M. Groenewegen has now been appointed as trustee and the court of Amsterdam has also granted a cooling off period (afkoelingsperiode) for a duration of two months. Swets Information Services B.V. has approximately 110 employees in the Netherlands. As a consequence of the bankruptcy the employment contracts with these employees will be terminated.
The bankruptcy of the Swets Information Services B.V.  does (for now) not affect its (foreign) subsidiaries as the bankruptcy is only related to Swets Information Services B.V. If and in which way the bankruptcy of Swets Information Services B.V. will affect its branches is currently under investigation by the trustee at this moment.
In the coming days the trustee and the Management team will continue discussions with organisations and individuals who may be interested in purchasing parts of the business and will be making every effort to try to preserve employment, where possible. Alternative solutions for the subsidiaries, or branches, of Swets Information Services B.V. which could see them continue activities on a stand alone basis will also be investigated.
During these negotiations we kindly ask any suppliers, publishers and clients with urgent queries to contact CMS directly by e-mail, from Friday afternoon onwards, at the following address: swets@cms-dsb.com.

UPDATE 9 (Sept 24) Message From IOP to Customers

Following the announcement that Swets has been placed in administration, IOP Publishing (IOP) is taking steps to ensure continuing access to its 2014 journal volumes for library customers that placed their orders via Swets.

• IOP will continue to fulfil orders for electronic access to 2014 and earlier volumes of its journals placed through Swets and paid by Swets

• IOP is assessing whether orders for print issues of 2014 volumes placed through Swets and paid by Swets will continue to be fulfilled by Swets. If Swets is unable to fulfil these then IOP will do so directly, but it is likely that there will be delays

• IOP is contacting library customers that placed their 2014 journal orders through Swets to discuss how those customers intend to place orders for 2015 volumes, or any further orders for 2014 volumes. IOP advises its library customers not to make payments to Swets in respect of such orders during this period of uncertainty. If customers wish to place orders and make payments during this time, they may do so directly, or through, other subscription agents.

UPDATE 8 (Sept 24) Message From De Gruyter to Customers

Dear customers, as you may have noticed in the industry news, Swets & Zeitlinger Group BV has successfully requested a temporary suspension of payments at an Amsterdam court. The court has honored this request and appointed a curator. De Gruyter has monitored the situation closely over the past few months. Although to our knowledge the business operations of Swets continue, we have decided to put all new orders or subscriptions through Swets on hold until payments for future orders have been made to De Gruyter’s bank account. Please note that this does not affect 2014 subscriptions, but only journal renewals for 2015 as well as book orders. De Gruyter’s management is in touch with Swets to resolve the situation as soon as possible. If you have any questions, please talk to your De Gruyter Sales Manager.

UPDATE 7  (Sept 23): Yesterday (Monday, September 22nd) I contacted the Swets office in the U.S. located in New Jersey. I asked for a statement/comment on the bankruptcy news. I was referred me to a public relations person at their home offer in Leiden, Netherlands and given an email address to send my request. The request was sent at 2:45 pm EDST. That was about 24 hours ago and we have not heard back from them.
UPDATE 6 (Sept 23): Full Text of Letter from Reprints Desk to Customers

Dear Customer,
We are writing to share what we learned about an important development today with Swets & Zeitlinger Group B.V. (Swets), which invoices you on a monthly basis for document delivery of single articles from STM publishers. Reprints Desk provides this document delivery service to you, however, it is billed by Swets. We have learned that on Friday, 19 September 2014, an Amsterdam court granted Swets a provisional suspension of payments. Please see the following link for more information: http://www.faillissementsdossier.nl/en/ We are contacting you today to obtain your immediate authorization to transition your document delivery billing from Swets to Reprints Desk starting with your September 2014 monthly invoice. It is important that we confirm the transition of your account to direct billing via Reprints Desk no later than 4pm U.S. Pacific Time on Friday, September 26 in order to avoid any interruption of your document delivery service. Please contact us as soon possible so we can ensure that there are no service interruptions for you or your users. In case we don’t hear from you, we will be contacting you as well to ensure that you have received this message and to ensure that your transition to direct billing by Reprints Desk is a smooth one. Kind regards, Shane Hunt

UPDATE 5 (Sept 23): SAGE is Now Alerting Customers to the Swets Bankruptcy

Urgent message regarding SWETS Subscription Agents going into administration SWETS, the subscription agent, has written to publishers to say that “To protect the business interests of Swets & Zeitlinger Group BV, we have requested the court in Amsterdam to declare a suspension of payments of Swets & Zeitlinger Group BV and appoint an administrator. This request was honoured by the court and, last Friday, Mr. J.L.M. Groenewegen (CMS) was appointed as administrator.” In the light of this, please send subscription renewals and payments for SAGE journals via other subscription agents or directly to SAGE. If you have recently made any payments to SWETS for subscription renewals relating to SAGE journals, please contact SAGE’s Customer Services representatives to review the status of these renewals. They can also help with any other renewal queries you may have about individual SAGE journal title renewals.

UPDATE 4 (Sept 23): Emerald Posts Message About Swets Bankruptcy
UPDATE 3 “Royal Swets & Zeitlinger Holding N.V. (‘Swets & Zeitlinger’ or ‘Swets’) is a group of information services companies operating around the globe. Swets & Zeitlinger operates under the trade name Swets, Accucoms, Libserv and Jongbloed.”
UPDATE 2 We have also learned that Elsevier has sent a letter to customers re: Swets and their bankruptcy. The note tells customers until an order for a publication is transmitted from Swets to Elsevier with payment, Elsevier will not be able to fulfill the order.
UPDATE Springer Posts “Important Update” For Swets Customers Springer’s announcement begins by telling customers that they, “are exposed to a substantial risk if they continue to submit payments to Swets for any Springer content” and that “Springer has terminated its contracts with Swets.” It goes on to urge customers to find “alternative agents” for any current or planned business with Springer. Read the complete post.

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