Turkish electronics and appliance maker Vestel Elektronik expects the pressures that forced it into one of the country’s largest corporate Eurobond restructurings to persist, pushing it to rethink its business.

It’s asking holders of its 2029 bonds to back a deal under which they can choose to take a 45% haircut or extend the debt by six years. The restructuring is meant to buy time as the business grapples with overseas competition and high costs at home, Chief Executive Officer Gokhan Sigin said in an interview.

“Asian competition will remain intense, and Turkey’s cost structure has changed permanently,” he said. “We don’t believe debt restructuring alone will solve this problem, and our plan isn’t based on that assumption.”The proposal is the latest step in Vestel’s effort to shore up its finances as earnings deteriorate and liquidity tightens. It has reported losses for 10 consecutive quarters, from 2024 through the second quarter of 2026, and its $500 million of notes due 2029 trade at about 25 cents on the dollar. Its shares are down by 45% this year, at around their lowest level since 2020.

One of Europe’s largest TV manufacturers, and for decades one of Turkey’s biggest exporters of electrical and electronic goods, Vestel supplies brands as an original equipment manufacturer.

Abandoning its decades-long pursuit of scale, the Zorlu Holding AS-controlled company is “moving from volume to value,” Sigin said. That means investing more in household appliances while becoming more selective in consumer electronics such as televisions, where price wars have eroded returns.

Sigin said the firm came under pressure as Chinese rivals redirected excess production to Europe after the pandemic, just as high energy costs, interest rates and weak demand hit the region. At home, a benchmark interest rate of 37%, a strong lira in real terms and rising minimum wages have driven up costs.

Sigin said Vestel is responding by streamlining operations, cutting fixed costs and improving factory efficiency. It plans to expand sales under its own brand in Turkey, where its distribution network gives it greater pricing power, while continuing to supply overseas customers.

It’s also moving into businesses less exposed to price wars, he said. Vestel’s mobility unit has developed megawatt-level charging technology for heavy electric vehicles, while the company sees energy storage as another growth area. It’s also targeting the US appliance market through its Finlux brand and partnerships, said Sigin.

The company is separately negotiating with a consortium of Turkish banks to restructure its domestic debt, seeking a two-year grace period on principal and interest and a final maturity in 2041, said Sigin. He added that talks are constructive but gave no timetable. The company aims to complete the Eurobond deal before the Nov. 15 coupon.

Bondholders have agreed to temporarily waive certain events of default and suspend some covenants while restructuring terms are negotiated. Moody’s cited the changes earlier this month, when it cut Vestel’s corporate family rating to Ca from Caa3 on Oct. 2 and lowered the 2029 notes to C, its lowest grade.

Moody’s said the changes allow Vestel to take on substantial additional debt, potentially reducing recoveries for existing creditors as the company grapples with operating and liquidity pressures.

Vestel is also reshaping its workforce. Local media reported this year that the firm had cut hundreds of jobs. Sigin acknowledged staffing changes but didn’t confirm the figures. He said there are no immediate plans for factory closures or large-scale consolidation.

“Our priority today isn’t to reduce capacity, but to use capacity more efficiently,” he said.

“Of course, a recovery in consumer demand or an improvement in interest rates would provide additional support,” he said. “But our strategy doesn’t depend on external conditions improving.”