SVI to liquidate two subsidiaries amid global economic slowdown
The Board of Directors of Thailand-based EMS provider, SVI, has approved the liquidation of two of its subsidiaries, SVI Hungary KFT and SVI-GDL, following a strategic review of their operations and future viability.
During a board of directors' meeting held in early August, the management of the EMS provider reached the decision to liquidate SVI Hungary KFT. This subsidiary – based in Hungary – had been partially divested by SVI Austria GmbH, a wholly-owned subsidiary of SVI, in March 2022.
At that time, SVI Austria sold 49% of its shares in SVI Hungary KFT to ml&s Personal Service GmbH and ESCHA GmbH & Co. KG, with an agreement that the purchasers would acquire the remaining 51% within a two-year period.
However, despite this strategic divestment plan, the purchasers were unable to inject new business into SVI Hungary KFT as anticipated. The global economic slowdown severely impacted their capacity to fulfill the agreement, resulting in the purchasers being unable to acquire the remaining shares. Consequently, this has led to SVI Hungary KFT becoming insolvent.
Given these developments, SVI’s management recommended the liquidation of SVI Hungary KFT – which the board approved.
Closure of SVI-GDL in Mexico
In addition to the decision regarding SVI Hungary KFT, the board resolved to close its dormant subsidiary, SVI-GDL, located in Mexico. Back in 2019, the company decided to establish a wholly-owned subsidiary with the goal of creating a manufacturing facility in Mexico.
This decision stems from a resolution passed during the board of directors' Meeting No. 1/2019, held on February 22, 2019, which initially approved the establishment of the wholly-owned subsidiary in Mexico, intending to create a manufacturing facility in the country.
However, the expansion plan did not materialise as expected due to insufficient customer demand. As a result, SVI-GDL remained non-operational and has been in a dormant state. After consideration, the board has decided to formally close the subsidiary.
