You are here

Insolvent Wirecard to slash more than half its German staff

Frankfurt am Main

ADMINISTRATORS for scandal-hit payments firm Wirecard said on Tuesday that the insolvent company would lay off more than half its remaining German staff.

Wirecard's workforce will be cut by 730 from around 1,300 staff currently, with 570 kept on at the firm's base near Munich.

"The economic situation of Wirecard was and is extremely difficult in light of the lack of liquidity and the well-known scandalous circumstances," the company's insolvency administrator Michael Jaffe said in a statement.

"The usual restructuring and cost-adjustment measures are not sufficient," he added.

Your feedback is important to us

Tell us what you think. Email us at btuserfeedback@sph.com.sg

"The number of employees and all other cost positions at all insolvent companies have to be adjusted to the corporate reality."

Wirecard's entire board of management has also been terminated.

The news came as a Munich court opened insolvency proceedings over the company's assets.

Administrators said they are in negotiations with "well-known interested parties" regarding an acquisition of the core business, including the group's still-solvent Wirecard Bank division.

Wirecard's Brazilian operations have already been sold off as part of administrators' efforts to recoup as much money as possible for creditors.

A sale of its North America subsidiary is "well advanced", the administrators added.

Digital payments provider Wirecard, once a rising star in the booming fintech sector, collapsed spectacularly in June after the company was forced to admit a 1.9-billion-euro (S$3 billion) hole in its balance sheet.

The company's former chief executive officer and several other top executives have since been arrested on fraud charges.

Wirecard was this month kicked out of Germany's blue-chip DAX index after its share price fell 99 per cent in the year to date. AFP

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes