French textiles group Dollfus Mieg et Cie (DMC) has suspended payments and is set to file for receivership before a Paris commercial court this month.  

Hit by a fall-off in business due to Asian competition, the weakness of the dollar and decreasing consumer purchasing power in France, its financial position has deteriorated further in the first quarter of the year, after a 19% decline in turnover during 2007.

Trading in DMC's shares has been suspended since last Thursday (April 24) and the publication of last year's losses postponed. Staff have been informed that salaries will not be paid for April. 

At the start of the year, DMC announced plans to shed nearly 20% of its current workforce totalling 1,100. Its SAIC Velcorex subsidiary, which produces corduroy, cotton and sportswear fabrics, is targeted to bear the brunt of the cutbacks.

By Stuart Todd.