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Talks to save BenQ Mobile Germany fail

By Reuters
Munich, 02 Jan 2007

Talks to save BenQ's German mobile phone business have failed with no investors stepping forward to rescue the business before a year-end deadline ran out.

A spokeswoman for insolvency administrator Martin Prager said on Monday that no offers had been received by the midnight 31 December deadline. Negotiations with several possible investors had been continuing as recently as Friday.

BenQ Mobile filed for insolvency for its Germany-based operations - the bulk of its business - in September, a year after it took the loss-making division over from German industrial conglomerate Siemens.

The company is expected to open insolvency proceedings formally in the next few days. The spokeswoman said Prager, who has been looking for a buyer for three months, would probably make a statement on Tuesday about the way ahead.

Some of the 3 000 former BenQ Mobile employees could still keep their jobs if investors are found to take on parts of the business.

BenQ Mobile's works council and trade union IG Metall said on Friday a German-American investor was interested in keeping up production of mobile phones and would rehire 700-800 staff.

Siemens itself has rehired about 80 BenQ Mobile workers and from Monday remaining staff will have their pay cheques paid by a transfer company largely financed by Siemens.

Once a company becomes insolvent, investors can bid for the most attractive assets and are not obliged to take on responsibility for the workforce.

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