History (1998): It’s Over for French Disk Head Manufacturer Silmag

No takeover solution has been found for the French disk head manufacturer Silmag, which has been under judicial control since last January 30, 1998.

The Commerce Tribunal of Grenoble has decided to put the company into judicial liquidation.

This will leave 400 employees without jobs, after an initial lay-off in January of 121 people.

DMC, the Italian subsidiiary of Silmag that employed 160 people in Bairo, Italy, was closed at the beginning of the year.

Hubert Jouve, Silmag executive, blames the current Korean crisis, and customer Samsung’s difficulties making payments, as the main source of the company’s problems.

The Korean HDD manufacturer, Silmag’s sole significant client, had decided to switch its drives from thin-film to MR heads. For its part, Silmag had chosen to discontinue MR heads, in order to move directly to GMR heads, production of which would not have started before next year.

A one-product one-customer firm is a tough business model to follow.

This article is an abstract of news published on issue 126 on July 1998 from the former paper version of Computer Data Storage Newsletter.