Vertu is facing a debt of 138 million pounds (about $178 million) and the company will now be forced to liquidate the facility after owner Murat Hakan Uzan could only offer 1.9 million pounds to cover the deficit. Uzan will retain the Vertu brand and its assets and reportedly hopes to resurrect the product line in the future.
Uzan only purchased Vertu in March and in June, sealed a partnership with TCL, the manufacturer of Alcatel and BlackBerry devices. TCL was to supply the luxury handset maker with advanced technology as part of the deal, which totaled an estimated $40 million and would have covered 30,000 units.
However, things began to fall apart quickly after the announcement. A report from the Telegraph emerged, citing overdue wages and payments to suppliers. At the same time, Uzan came under fire from Vertu’s previous owner, Gary Chen, regarding unpaid funds relating to the sale. Uzan claimed the company’s financial issues were concealed from him until after he assumed ownership, and the two sides have been threatening legal action.
As for Vertu, Thursday’s news marks what is likely to be the end of a chapter for the company. Nokia established the brand in 1998, with an attitude of building phones with the same level of attention and craftsmanship typically found in designer watches. As of 2013, Vertu operated 500 retail stores worldwide.
At the moment, other aspects of the company have not been affected by the manufacturing shutdown, though that is likely to change in the coming weeks. We will keep you updated as the situation unfolds.
Vertu’s latest device is the Constellation. Released in February, the phone features a Qualcomm Snapdragon 820 processor, runs Android 7.0 Nougat (with an update), and features a sapphire-coated display. At a starting price of $6,000, it slots in beneath the company’s New Signature Touch, which begins at $9,000 and lacks the more expensive model’s more dramatic design touches — like a spring-loaded gull-wing door for the SIM card.
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