November 29th, 2013 – Marly Switzerland – Today ILFORD Imaging Switzerland GmbH announced that the company is again facing liquidity issues and is no longer able to honour its full financial obligations. The Managing Directors have already informed the employees and have sent a letter to the court of Fribourg declaring insolvency.
In June 2013, ILFORD Imaging experienced a liquidity issue after the former shareholder Paradigm Global Partners, a UK based financial investor suddenly withdrew from the business. Since then the management took over the company to secure the business short-term and also to find a new long-term investor.
The new shareholders, Paul Willems and Jean Marc Métrailler, initiated the sale of land owned by the real estate company ILFORD Property and invested these funds in ILFORD Imaging in order to provide sufficient liquidity to bridge the time until a new investor could be found. The ILFORD investment opportunity was presented to more than 20 interested parties from all over the world. Unfortunately, a new investor for ILFORD Imaging has not yet been found and the last potential investor pulled out earlier this week.
After the liquidity issues during the summer, it was challenging to re-start the business, as many existing customers began to buy products from competitors, which resulted in a large negative impact on the company’s revenue. In addition, ILFORD had to operate in a particular difficult market where demand is decreasing and manufacturers compete on low prices due to excess capacity. Furthermore, most suppliers would only deliver raw materials against payment in advance. These circumstances, along with the fact that the company had to replenish its inventories, and after payment of the late salaries of June and July, required additional cash.
The restructuring measures that were taken in August 2013 were necessary to improve the competitiveness of the company medium- to long-term. However these measures have not been fully effective yet and the impact will only be realised in the first quarter 2014.
The management is working closely with the State and the appropriate authorities in order to minimise the negative impact on all parties involved. No further information can be provided until the decision of the court is made and the next steps are understood.