Protective shield proceedings initiated: Devolo repositions itself
Devolo has begun protective shield proceedings. Sounds worrying, but the company itself is relaxed about its future.
At Devolo, the warehouses are full. This is leading to liquidity problems. However, the company is far from insolvency. The restructuring is expected to take only a few months.
Customers should not notice anything
There should be no changes or delays in customer support and software updates. "Devolo AG's business operations will continue in full during the entire restructuring process," press spokesman Marcel Schüll explained when asked.
The restructuring is expected to be completed in a few months. "Our core business as well as the operating business are healthy. In addition, the market outlook is positive," Heiko Harbers, Devolo AG's CEO, is optimistic. In the medium to long term, those responsible at Devolo expect positive business prospects. The company is the market leader in the powerline sector and interest in smarthome technologies will continue to grow.
A lot ordered, but not everything sold
The so-called protective shield proceedings are part of German insolvency law. Devolo makes a point of not having filed for insolvency. And that is precisely what the protective shield proceedings are intended to prevent. In simple terms, it is intended to enable restructuring when payment problems are imminent but have not yet arisen.
In Devolo's case, these are the effects of the Corona pandemic and the chip crisis. Thus, according to the company, it had to order goods early to avoid being affected by supply bottlenecks. However, sales did not develop as expected from the second quarter of 2021. People were buying less, and by the beginning of 2022, the company had a high inventory level, which in turn led to a liquidity shortage. In addition, the chip shortage had ensured that products for project business with network operators were not available.
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