The future of Dutch computer services vendor Getronics is hanging in the balance after it was forced to extend its deadline for a proposed debt-for-equity rescue deal and warned that it foresaw no trading upturn this year.
“There remains uncertainty as to whether Getronics will be able to continue as a going concern and Getronics may therefore be unable to realise its assets and discharge its liabilities in the normal course of business,” it warned in a statement.
That follows the rejection of a similar package put to stockholders in January, the departure of Getronics’ management team in February and denials that its rescue deal had violated Dutch insider trading regulations.
The trading warning coincided with the release of Getronics’ financial results for 2002, in which revenues fell 13.4% from €4.15 billion to €3.6 billion. However, the company attributed its hefty €362 million operating loss to goodwill impairment charges of €375 million.
“Market conditions remained difficult throughout 2002, with a deteriorating economic outlook leading to a drop in market demand. Clients tended to postpone or cancel investments resulting in an increase in pricing pressure across the sector,” the company said in a statement.
The company’s difficulties stem from the $2 billion May 1999 acquisition of rival Wang, the once high-flying mini-computer vendor that re-invented itself as a purely services company after it emerged from Chapter 11 bankruptcy protection in 1993.