Troubled Italian PC vendor Olivetti Computers Worldwide (OCW) hasO team mounts offer. stalled in its bid to bounce back as it filed for court protection against creditors in its home country late last week.
Buckling under the pressure of rising debts, OCW applied for protection after the vendor failed to secure further credit from its bank and has since been forced into discussions of a management buyout.
Sources in Italy insisted that corporate contracts have suffered as a result of the cash crisis, although UK management insisted that was not the case here. But the ability to source the UK channel had been compromised.
Ian Davidson, UK marketing manager of OCW, conceded the state of the parent company meant UK channel inventory 'is becoming an issue'.
At an emergency shareholders' meeting last week, it was agreed the manufacturer would remain under court protection from creditors for up to three months, until a revival package can be devised.
It is understood that OCW owes former holding company Olivetti Group L88 billion, giving the giant a say in the PC vendor's future.
Roberto Colannino, chief executive of Olivetti Group, is understood to have laid down conditions under which, subject to shareholder approval, it would bail out OCW.
Majority shareholder Piedmont International will reduce its controlling stake from 80 per cent to 35 per cent to make way for an sale. Piedmont will also have to relinquish the Olivetti brand licence, which it took out for 20 years following the controversial acquisition of the then loss-making OCW two years ago (PC Dealer, 27 January 1997).
No one at Piedmont was available for comment.
According to Davidson, management will control a 55 per cent stake and Chaplet, a partner in the Far East, will assume 10 per cent. A five-bank consortium has also been introduced to provide L130 billion for the MBO.
Olivetti Group will also agree to write off the L88 billion debt and provide further cash injection of L50 billion, subject to the conditions being met.
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