Pantech has filed for bankruptcy, according to the Wall Street Journal.
The Korean OEM ended the first quarter with nearly $1 billion in debt, which the report points out is almost double the worth of the company’s assets.
Pantech is the third largest smartphone maker in Korea behind Samsung and LG but its device haven’t gained much traction in the U.S. In Korea, Pantech sells high-end devices like the Vega Iron. In the U.S., the company sells mid-tier devices like the Discover.
Aside from indifference in the U.S., Pantech has been bit with lagging sales in its home market of South Korea. Local carriers have reported as many as 500,000 unsold Pantech units in their backrooms.
Both Samsung and Qualcomm own stakes in the struggling OEM and reportedly both companies are looking to sell their shares. Samsung invested $51 million a year ago for a large stake in Pantech but now even Samsung is feeling the sting from high smartphone penetration and increasing competition from low-cost Android device manufacturers.
Pantech now has to come up with a plan to get back on track.