Prodisc Technology Inc (精碟科技), one of the nation’s leading disc makers, on Wednesday said it planned to shut down its business because it had failed to win court approval for its corporate restructuring plans.
As of Friday next week, Prodisc will no longer manufacture optical discs, and therefore retreat from the disc market in Taiwan, the company said in a filing submitted to the Taiwan Stock Market on Wednesday.
The New Taipei City (新北市)-based company said its board members on Wednesday passed a resolution ceasing the company’s disc production because the Banciao District Court had ordered that the company’s manufacturing equipment be put up for sale due to Royal Philips Electronics NV and some of Prodisc’s creditors’ opposition to its restructuring proposals.
CONTINGENCY PLANS
Prodisc did not elaborate on whether the company has contingency plans to help workers find new jobs.
The company has been in financial difficulties since 2008 when Philips ordered provisional seizure of some of Prodisc’s bank deposits in a contract dispute.
In August 2008, Prodisc sought approval from the court for its corporate restructuring plans and other emergency actions after its assets were detained by the Netherlands-based electronics maker.
OBJECTIONS
However, due to objections from Philips and some of its creditors, Prodisc’s reorganization plans have not been realized over the past five years, with the court failing to sanction the company’s application.
To survive in the disc market while awaiting court approval for its business remodeling plans over the past five years, Prodisc continued producing discs and sought to expand its business by signing contracts with foreign firms or increasing spending on research and development of new technologies for which it could apply for patents.
Despite these efforts, Prodisc said it was still unable to make ends meet as the disc market has seen oversupply in tough economic times.
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