 In order to prevent bankruptcy, Klöckner sought to have written off 40% of a 175 million Deutschmark loan from the European Coal and Steel Community – in return Klöckner agreed to reduce production capacity from 4.2 to 3.7 million tons pa.In late 1993 a consortium comprising Klöckner (33.35%) and mainly public funding from the Hanseatische Industrie Beteiligungen GmbH (HIBEG) (31.99%) and Stadtwerke Bremen AG (SW) (13.33%) proposed re-capitalising the business (c. 250 million Deutschmarks, plus loans), as Klöckner Stahl GmbH, after acquiring the business for a nominal sum; due to the largely public nature of the shareholders the proposal was investigated by the European Union under its state aid rules.In July 1994, an altered consortium incorporating private steel firm Sidmar (25% stake) was given permission by the European Commission to acquire the business.