Ongoing financial problems at its South Korean unit continue to plague Lernout & Hauspie Speech Products. Earlier this week, the speech recognition developer announced that it has voluntarily filed a Chapter 11 petition for reorganization protection under U.S. bankruptcy code. The firm, which is based in Ieper, Belgium, and Burlington, MA, will also file a request for concordaat reorganization under Belgian law. L&H will continue operating.
The company believes that the Chapter 11 filing will allow it to continue addressing its past problems, while developing a new strategic plan to leverage its technology assets and market access, and restore profitability.
An important factor in the firm’s decision to file was the discovery of a very significant cash shortfall on the balance sheet of its Korean subsidiary, according to general counsel Daniel Hart. L&H will vigorously investigate this shortfall with the assistance of external resources, Hart said.
By AuntMinnie.com staff writers
December 1, 2000
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