Reply To: Native Instruments Insolvency and Updates

[LinkedMusicians]

I just wanted to update this to address a question that I see comes up — or is misunderstood — about the preliminary insolvency process. First, this process is about a court-appointed administrator overseeing an analysis of the company to determine what is the best course of action to maximize what creditors can recover from NI; the administrator is trying to preserve as much value as possible for creditors — that’s the objective of the role. German laws provide for a three-month guarantee of salaries for company employees — although that doesn’t apply to employees in divisions of NI incorporated in other jurisdictions, like Plugin Alliance.  Employees of those companies can face termination on the day bankruptcy is filed.

The preliminary insolvency process can take between several weeks and a few months. At that point, the administrator will determine if NI should be restructured, refinanced, or sold as a going concern. Of course, those decisions won’t be made in a vacuum; the market appetite to buy NI as a whole or parts of the company are a major factor. So, for example, within the next few months, we could find that they’re in negotiations to sell all or parts of NI. One thing I’m very confident of is that the administrator will not decide to keep the company as is. That’s extremely unlikely, as NI wouldn’t be in the current state of overwhelming debt if that were a serious possibility.

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