The Grundig Story

Grundig had filed for bankruptcy in April 2003 and was undergoing insolvency administration. The Anglo-Turk 50:50 joint venture took control of the Home Intermedia Systems (HIS) division of Grundig, which was to be transferred to a new entity called Grundig Multimedia BV (GMB) with its headquarters in Amsterdam, The Netherlands. Grundig, established in 1945, was a revered name in its country of origin, Germany. It was one of the "architects" of Germany's post-war economic revival. The company, which was known for its high-tech radios and receivers, was a huge success till the mid 1970s. Sales began to decline in the late 1970s and in 1980, the company recorded a loss for the first time in its history.

Though Grundig's range of products were technically and aesthetically superior, their high price was a major damper on sales. Grundig was also reluctant to shift its production base to low cost countries like China. A combination of low sales and increasing cost of production caused the eventual ruin of one of Germany's post-war corporate icons. Analysts said Alba and Beko, both known for their low cost operations, were a good team to rescue Grundig from its destructive downward spiral. Alba, with an array of brands was seen by industry experts to be strong in distribution and marketing. Beko, on the other hand, was one of the largest TV manufacturers in Europe and had strong operational strengths.