The Vorarlberg textile firm F.M. Hämmerle Textilwerke GmbH entered bankruptcy proceedings on Thursday.
The Credit Protection Association (KVS) said that the firm, based in Dornbirn near the Swiss border, had around six million Euros debts and that 312 employees and around 300 creditors would be affected.
Firm chief Josef Hahnl said that the cause of the firm's financial problems was a more than 50 per cent drop in business over the past year.
Whether the firm will be able to survive proceedings is not yet clear. Vorarlberg Governor Herbert Sausgruber told firm employees that they have his support and announced that a labour foundation would be established to help them.
The firm was founded in 1836 and had become one of the largest Austrian textile companies, with 2,200 employees, in 1988 but this is also when its financial problems reportedly began. Hahnl became CEO in 2000 with a mandate to put it back on its feet.
Hämmerle is one of a large number of textile firms in Vorarlberg that have entered bankruptcy proceedings in the past 20 years.
