July 16 (Bloomberg) -- Loewe AG, the German television maker responsible for the first public TV transmission in 1931, applied for protection from creditors after its focus on quality “made in Germany” failed to revive sales.
The company, which produces exclusively in the country, filed for creditor protection, a process comparable to Chapter 11 in the U.S., at the Coburg local court to help reorganize with the help of strategic partners and investors, Chairman Matthias Harsch said in a statement today.
Loewe was founded in Berlin in 1923 by Siegmund and David Ludwig Loewe. The founders left Germany as the Nazis “aryanized” Jewish-owned enterprises, and the company restarted production in the Bavarian town of Kronach after World War II. In recent years it struggled to win buyers for high-end flat-screen TVs, audio speakers and home entertainment systems, as sales fell to 250 million euros ($327 million) last year from 374 million euros in 2008.
“Loewe is entirely dependent on the European market, where demand for TV sets is very weak,” said Anne Gronski, an analyst at Matelan Research GmbH. “They should have outsourced earlier to compensate for the drastic drop in TV prices.”
Loewe shares plummeted as much as 27 percent today, before rebounding to trade 3.3 percent higher at 2.05 euros as of 12:30 p.m. in Frankfurt. That pared the drop to 26 percent this year.
While Loewe was speculated to be a takeover target for Apple Inc. last year, the company has denied it held talks with the iPhone maker. Loewe, which hasn’t been profitable in three years, said it remains solvent. Sharp Corp. had a stake of about 29 percent in Loewe at the end of last year, according to data compiled by Bloomberg.
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