Dogged by losses, Tulip Computers NV may be about to enter a new era of growth after a deal hammered out with the company’s creditors by venture capital company Royal Begemann Group NV, which will inject $50m into the European PC manufacturing hope. Production of Tulip PCs, likely to be around 60,000 this year, will rise to an annual figure of around 150,000 within the next few years under the proposals. Subsidiary companies will be maintained in Belgium, France, Italy, Germany and the UK, and the company is investigating whether to keep on sales offices in other countries. Tulip will aim for an operating profit of 4% and net income of 2.5%-2.8%. If the plan is approved by creditors and endorsed by a court, production of Tulip computers will be outsourced to Ingram Micro Inc, which is taking a lease on the production facilities as part of a plan to turn it into one of its five global integration centers (CI No 3,415). Once the plan gets the go-ahead, Royal Begemann Group will put around $50m of risk bearing capital into Tulip which will be converted into Tulip ordinary shares at the end of this year. To further boost cash resources, Tulip ordinary shareholders will be able to buy one new Tulip share for one guilder a share for each existing Tulip share. Begemann will end up with around 30%-35% of Tulip shares. Ingram Micro is taking on 109 existing Tulip staff and the new Tulip will employ 250 people, of whom 132 will be in the Netherlands. Tulip, which once employed 1,000 staff, was granted court protection from its creditors in April after it lost $14m on sales of $230m last year. The company suffered at the hands of ferocious US competition and its problems were exacerbated because of start-up problems at new production facilities.
