Anaheim circuit board maker DDi Corp. said Wednesday it plans to shut its European operation after failing to land a credit pact to its liking.
DDi, which makes circuit boards for computer and other electronics companies
on short notice, said it plans to put its European unit in administration.
That should allow DDI to remove about $38 million of debt from its balance
sheet.
The closure is expected to help earnings and isn’t expected to affect the
company’s North American operations, DDi said. But the closure could impact
sales,Europe makes up a third of DDi’s sales.
DDi sought to rework its debt after it said demand in Europe fell. Lenders
asked the company for more cash as part of a deal to restructure its debt,
DDi said.
The company filed for bankruptcy reorganization in 2003 and emerged from
Chapter 11 later that year.
DDi saw its business pick up in late 2003 and early 2004 as the market for
technology products picked up.
Late last year, DDi and other circuit board makers saw demand for their
products slip, a trend that crimped profits.
Investors drove up DDi shares on the Europe news, cheered by the prospect of
less debt on the company’s books. The company’s stock shot up about 8% early in the day and was up about 5% to $2.50 later.
DDi counted a recent market value of $65 million.
