LUXEMBOURG -- Elcoteq’s chief executive resigned today following a dispute with its top lenders.

CEO Jouni Hartikainen today stepped down after seven years at the helm of the contract electronics manufacturer. His decision followed a move by the embattled firm to apply for insolvency after a group of banks led by Danske Bank froze its accounts after Elcoteq missed a loan payment.

"[Hartikainen's] ability to manage the company and to objectively safeguard the benefits of all the company's stakeholders became impossible due to the recent actions by the revolving credit facility lenders," Elcoteq said in a statement today.

At the time of its insolvency application, the EMS firm was working to secure an investment from Platinum Equity, but that deal too has fallen apart. "The revolving credit facility lenders have continued their enforcement actions against the company and have, among other actions, blocked certain bank accounts of the company and seized the payments of Elcoteq's customers in Europe and [the] US. Due to these actions, the future business outlook is very uncertain and the company is only partially able to control its business processes," Elcoteq said in a statement.

Aki Palo, head of credit at Danske Bank, said, "We've been in talks with Elcoteq for several years. We gave them time to find a solution, but they didn't manage to do that," he added.

Elcoteq said it would initiate discussions with other "potential investor candidates" and rely on support from customers to keep its operations running.

Elcoteq's sales fell to 1.07 billion euros in 2010, down from 3.44 billion euros as recently as 2008.

• Prev
• Next