The company Neuro Socks, based in Vienna, has a huge debt burden of around five million euros and has filed for bankruptcy, but will continue to operate. According to its own statements, the company produces health-related clothing. But after a ban on advertising with health claims, such as socks, the spots were stopped. According to creditor protectors, this has led to a decline in turnover and the company has now filed for bankruptcy.
The debts amount to 6.2 million euros and the assets 1.2 million euros, the AKV reported on Tuesday evening. According to KSV1870, the debtor originally set up a powerful direct sales system for its “Neuro products” through so-called business partners, which worked on a multi-structured and commission basis. There are currently approximately 1,000 active business partners.
Various legal proceedings
In 2019, Neuro Socks gained a partner for the broader marketing of the products in Mediashop GmbH, which offers a wide range of products on advertising TV. Mediashop took over the wholesale and television advertising.
However, after 2020, various legal proceedings were initiated at the Association for Consumer Information (VKI) due to the health claims – which were ultimately no longer made. As a result, there was a sharp decline in sales and legal disputes arose with the main supplier, which led to bankruptcy.
The company wants to restructure
The company now wants to restructure itself and continue operating. The first restructuring measures have already been taken. The bankrupt company offers creditors a 30 percent quota, payable two years after acceptance of the self-managed restructuring plan. The creditor protectors check the quotas for suitability.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
