Loewe clarifies move to insolvency and says it has received formal offer from a new investor

28 Oct 2013

Loewe Reference ID TV

Update 28.10.13

Loewe has today confirmed it has received a formal written offer from an external investor and is now moving into the final phase of negotiations to secure its future. It expects to be able to announce further details shortly.

“This means we have reached a crucial milestone that will put Loewe firmly back on track for success,” says Matthias Harsch, Loewe’s Executive Board Chairman.
 
"A new investor is the latest building block which, together with the strategic relationship with Chinese company Hisense, will deliver a very exciting roadmap of products due in 2014," the company says.

 

Published 02.10.13

Loewe has issued a lengthy statement today clariifying its current financial situation following reports yesterday that it had moved into an insolvency process.

"Following the three-month period of 'Schutzschirmverfahren' – a form of creditor protection under German law – Loewe has moved seamlessly into a self-administration insolvency process known as Insolvenzverfahren in Eigenverwaltung," the statement says.

"This is a pre-planned phase of Loewe's ongoing re-structuring process, allowing further time to complete its strategic realignment and secure new investment. During this phase, and before the end of this month, Loewe expects to reach an agreement with an investor."

Matthias Harsch, CEO of Loewe AG, adds: "We have a number of offers from investors, from which we will choose in the next four weeks."

In the meantime, the business remains fully operational and the restructuring process initiated by the Executive Board continues unchanged. The company's banks and the Bavarian state Government continue to support the restructuring of Loewe as a new investor is signed up.

"Loewe's business will remain fully operational and Loewe will continue to fulfil all of its obligations," says Harsch. "This also applies to warranty processing, service and uninterrupted availability of merchandise."

Loewe says that its new product rollout continues, with new TV and audio products still scheduled for launch in the final quarter of 2013 and into 2014.

"With the recently agreed strategic technology partnership with State-owned Chinese company Hisense making good progress, a dramatically reduced cost base and a robust new strategy, Loewe looks set for an exciting new future."

 

Published 01.10.13

In another sign of the turmoil in the TV market, German high-end TV manufacturer Loewe today moved into a self-administration insolvency process and is urgently seeking a new investor to secure its future.

The firm's chief executive Matthias Harsch told Reuters that Loewe has enough cash to continue operating until the end of this year, but if it fails to find a new investor by then "it would be over".

Back in July Loewe filed for creditor protection in Germany, similar to invoking Chapter 11 in the United States. At the same time, Loewe formed a joint strategic partnership with Chinese consumer electronics manufacturer Hisense.

Harsch says the company, founded 90 years ago in Berlin, has six bids from outside investors and hopes to choose one in the next month.

Intense competition and price erosion in the TV market left Loewe nursing a 39 per cent sales slump in the first half of this year, resulting in a net loss of €26.7m (£22m). Loewe is not alone: yesterday, Toshiba announced it will lay off half the staff in its loss-making TV division (around 3000 jobs) and close two of three TV plants outside Japan.

Falling profits at Philips forced it to enter into a joint venture with Chinese firm TP Vision in 2011, Hitachi has closed its last TV plant in Japan, and Panasonic and Sony have had to restructure their TV divisions to stem mounting losses.

By Andy Clough

 

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Comments

Story updated: Loewe has today confirmed it has received a formal offer from a new investor, and hopes to make a further announcement shortly. We'll keep you posted.

We've had a major statement from Loewe this afternoon, so the story has been updated. CEO Matthias Harsch remains confident of securing a new investor in the next four weeks.

What a shame. I went to the LOEWE factory 4 years ago in Germany. What a lovely bunch of guys, innovative and enthusiastic about their product.

When you think of the utter rubbish sold by B+O and the prices they get away with charging then this is a travesty. Loewe were never going to compete with Samsung ETC but i still believe there is a place for their products.

Change the Loewe circle/symbol at the front to an Apple shape and their fortune could change... Jest aside, it's a shame when an innovator and individualist can't remain in the market any longer, but at some point the price aspect will make it difficult when the Japanese and Korean competitors offer fantastic products for less than half price. 

I wish them luck with their restructuring plans and pursuit of an investor. Approach Apple?

I've had a phone call from Loewe UK's PR this morning and they will issue a clarifying statement later today. As soon as we have it, we'll update the story.

Sadly the market space Loewe are dealing with i.e. premium TV & audio, is shrinking and their models no longer offer the USPs they once did to encourage splashing out the extra cash. I own an Individual TV and have to say I am still impressed to this day how good the performance is for an LCD (it's the older pre-LED model), but a £1200 Panasonic GT60 is an clear winner when compared to a £2800 Loewe Individual SlimFrame.

It depends on manufacturing costs to make the product viable at their pricebracket, but I would say Apple makes a good fit for Loewe - drop their Apple TV-esque interface on a Loewe TV chassis and you have a desirable designed and functional product that could dominate the living room. Just a thought!

I got it from Harrods.

Well markiedee I would get out of that purchase, sharpish unless where you purchased it is capable of supporting the product for the next 5+ years.

Loewe have always been way overpriced and obviously thought a bit a alternate design would give them a B&O status.  Sets were good but not sufficiently so to in any way support the price.  Sad for the workers but yet another example of style over substance.  

It really is a shame especially after buying a loewe compose 46 led last week, just awaiting delivery of it. I have to disagree with you when you say that there overpriced for what your actually paying for as the picture sound and quality of build far exceeds that of other brands.

the recent loewe reference id and new loewe slimframe tvs have by far the best picture quality i have seen to date on an led tv, brilliant non over saturated colours no noise in the picture no motion blur sublime sound quality and a work of art to look at too.

after viewing these then looking at everything else around to me there's no comparison. They really are a premium product but are fighting a losing battle in this current climate especially with the samsungs and lgs.

i do hope that they pull through and that they should hopefully still be around should I encounter problems with my soon arriving purchase.

That's really sad. Loewe is one of the better quality manufacturers.

Another sad story and I feel sorry for those who will end up losing their jobs but hey let's face it - their products were ridiculously overpriced for what you were actually paying for.