Mobile phone maker VK is going into receivership. The company was originally established as a handset battery manufacturer in the late 1990 and switched to handsets in 2002.

VK creditors including the National Agricultural Cooperative Federation at a meeting Thursday decided to put the company in a debt workout program. That ends a rollercoaster story that saw VK grow and earn W400 billion (US$1=W950) in sales in 2004 even as other medium-sized phone makers like Sewon Telecom and Telson Electronics went bankrupt.

Until early last year, VK supplied hundreds of thousands of handsets to Vodafone, but the rising value of the won against the dollar has put a huge burden on the company since the second half of last year. It also lost out amid aggressive marketing strategies of global big-name handset makers like Nokia and Motorola.

Faced with the squeeze, the firm restructured and laid off staff, and reduced production at its factory in Ahnseong from 300,000 units a month to 100,000. In a last ditch attempt to survive it borrowed W10 billion from its biggest buyer SK Telecom in March and raised W1.4 billion by issuing new shares, but to no avail.

(englishnews@chosun.com )