Qimonda Files For Insolvency Page: 1
Qimonda Files For Insolvency
In what can only be described as a shock announcement, German DRAM manufacturer Qimonda has filed for insolvency. Qimonda was born out of split between subsidiary company Infineon Technologies (Siemens AG), and up until a few days ago were the fifth largest DRAM-vendor controlling approximately 10% of the market.
Typically, insolvency means that an individual or business are unable to repay debts, however, German insolvency law also "...offers the opportunity to accelerate the restructuring process that has already been started in order to reposition the company back onto a solid base" (Industry Week). Whether Qimonda will manage to stay afloat remains to be seen, but the forecast isn't cheery by any means.
The heavily loss-making firm, one of Europe's few remaining chipmakers, threw in the towel after being hit by the slowdown and a further worsening of the semiconductor market...
Only last month Qimonda secured a 325-million-euro (US$450 million)rescue package from the German state of Saxony, the federal government and a Portuguese development bank and Infineon. But sources said that the firm, which has been in trouble since before the global economy hit the rocks, still needed another 300 million euros to be able to continue operating. An additional 280 million euros in guarantees from the federal government and from Saxony, the eastern state where the firm is a major employer, were also contingent on its raising the funds.
The economically depressed Saxony, where Qimonda is a major employer, refused to put up another 150 million euros and talks in Berlin with Chancellor Angela Merkel's federal government also failed.
Qimonda Insolvency Press Release
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