Qimonda AG said yesterday that it is talking with investors in Asia to save the cash-strapped company, but it is unclear what this latest development means for its manufacturing operation in Henrico County.

The Munich-based memory-chip maker filed for insolvency protection last month in Germany, which is similar to filing for bankruptcy.

To reduce costs and focus company resources on producing the latest semiconductor technology in Germany, the company last week announced plans to idle its eastern Henrico plant by April. The closure will put 1,500 employees at the Sandston plant out of a job. Qimonda had announced last fall that it would lay off 1,200 workers.

Glen Haley, spokesman for Qimonda North America, said it would be premature to talk about what an infusion of cash would mean for the local facility.

"I honestly don't know what the impact will be for Qimonda North America," he said.

In other news, two class-action lawsuits were filed in U.S. District Court in Richmond yesterday alleging that Qimonda had violated a federal labor law. Both suits named Qimonda North America and one also named Qimonda Richmond and Qimonda AG.

Three class-action complaints have now been filed against the company in less than a week. All claim that the memory-chip manufacturer violated the Worker Adjustment and Retraining Notification Act, which requires employers to give 60 days' notice of layoff or closure. In lieu of notice, companies can continue pay and benefits for 60 days.

A week ago, Qimonda officials gathered employees in the plant's cafeteria and said the facility would be closed down by April. Over the course of two days, 500 people were laid off immediately. An additional 500 will be gone within the month.

In a letter to employees, top management claimed that an inability to secure credit and a lack of money on the part of the parent company to purchase memory-chip wafers led to the decision.

Since there are three class-action suits alleging nearly the same thing, the judge will likely hold a scheduling hearing and pick a lead attorney, said Philadelphia attorney Charles Ercole, who has signed up more than 165 clients for his class-action suit.

The suits seek lost wages, salaries and accrued holiday and vacation pay, as well as health benefits.

Haley declined to speak about the lawsuits. "I'm not going to offer any comment on new or ongoing litigation," he said.

It is unclear how the lawsuits could affect turnaround efforts in Germany, which are ongoing.

The magazine Wirtschaftswoche reported that CSMC Technologies Corp., a unit of China Resources Microelectronics, is interested in buying Qimonda and has been negotiating with the company for months, citing an unidentified person in the industry.

"We are in talks with potential investors who are in Asia," Qimonda AG spokesman Ralph Heinrich said during a phone interview. He did not name them.

Qimonda executives and representatives of Michael Jaffé, the company's insolvency lawyer, flew to Asia last week to look for investors for the chip maker.

Qimonda is 77.5 percent owned by Infineon Technologies AG, Europe's second-largest maker of semiconductors.

By: DocMemory
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