A €325M rescue fell through and Qimonda went bankrupt — 12,000 jobs lost

Qimonda was a maker of computer memory chips, spun off from the German semiconductor group Infineon in 2006, with Infineon retaining a 77.5% stake. It was a large employer — more than 12,000 workers worldwide at the end of 2008, including about 3,500 in Saxony, 1,500 in Munich and several thousand in Portugal — on revenue of roughly €1.8 billion that year.

Memory chips are a brutally cyclical business that demands constant, expensive investment in new production. When the global financial crisis hit in 2008, chip prices collapsed just as Qimonda needed to spend. The company ran out of cash, and its survival came down to a rescue package of €325 million (about $422 million) in loans from the state of Saxony, Infineon and a Portuguese state bank.

The package did not come together. On 23 January 2009 Qimonda filed for insolvency at the Munich administrative court — one of the largest corporate collapses in Germany during the crisis. In the months that followed, thousands of employees were moved to a transfer agency as the company was wound down.

Qimonda is a textbook case of a capital-intensive technology business caught on the wrong side of a cycle: it had to keep investing to stay competitive, but the downturn closed off the funding before the investment could pay off, and a rescue that would have bought time never arrived.