German computer retailer Escom AG filed for bankruptcy yesterday. The Heppenheim company has been in insolvency proceedings since July 2 and the court-appointed administrator judged that Escom was unable to raise enough capital to keep it afloat long enough for possible restructuring talks to be held under the insolvency procedure. In Germany, the bankruptcy filing applies only to the holding company Escom AG and not to its stores. Escom’s shares fell by 55 pfennigs, or 30%, to a new low of 1.30 marks, after the news. Under German law, a company must file for bankruptcy if it fails to get agreement from a majority of its creditors to a restructuring plan enabling it to pay back 35% of what it owes within a fixed time. The receivers of Escom UK Ltd say they are hopeful of selling the business as a going concern, and have already had a number of of serious enquiries. Escom UK Ltd employs over 1,000 people, generating annual sales of over 200m British pounds.
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