Daewoo PC problems leave UK arm in limbo

Creditors left the future of Daewoo UK's PC arm in doubt last week as the parent PC and peripherals operation was forced into administration.

The fate of the UK unit is as yet unclear, but Korean banks have taken control of the struggling South Korean chaebol's Daewoo Telecom, Daewoo Heavy Industries and Daewoo Electronics operations.

Daewoo Telecom manufactures PCs, notebooks and peripherals. Its UK arm is still trading.

All of the group's divisions are already in a debt recovery programme under the control of South Korea's Financial Supervisory Commission (FTC).

It is attempting to bail the company out of $48bn of debt.

However, on 13 September, the number of writs against Daewoo reached 10 and the firm's European assets have started to be seized by some of the disgruntled 240 non-Korean creditors.

The Korean giant has struggled to establish distribution in the UK. It partnered with Wolverhampton mail-order company Roldec in late 1997, but Roldec went into liquidation earlier this year citing problems with Daewoo notebooks (PC Dealer, 24 March).

Mandy Birtles, marketing communications director at Datrontech, said: "We were stocking Daewoo, but stopped selling its products earlier this year. We made a strategic decision to focus on Hansol."

Chris Walmsley, sales manager at Logitek, added: "We held Orion (Daewoo's monitor arm) monitors. We bought stock in bulk four months ago. We have finished selling those and will not be renewing the relationship. We are now working with LG."

A spokeswoman for Tempo revealed that it terminated its Daewoo lines.

However, a spokeswoman for Comet revealed: "We are still selling Daewoo machines and have not been informed of any change to the relationship."

Daewoo refused to comment on the matter.