BERLIN (AP) -- Famed German model railway maker Maerklin filed for bankruptcy protection from creditors on Wednesday after it failed to secure new credit from banks.
Maerklin Holding GmbH made the bankruptcy filing at a court in Goeppingen, the company's southwestern German home town. The company said that its everyday business would continue unaffected.
Its managers intend, in consultation with its bankruptcy administrator, "to restructure our traditional company with its cult status, with the instruments of German insolvency law, and establish it permanently in the market," Maerklin boss Dietmar Mundil said in a statement.
Maerklin began 150 years ago as a small factory making tin toys and has evolved into an iconic name in the model railway market.
It prides itself on using materials as close as possible to the real thing, including aluminum, alloys, high-quality plastics and wood.
The company, which makes its products in Germany and Hungary, has some 650 employees and had sales of about euro128 million ($165 million) last year.
It said that it was able to increase sales in 2008 "despite the difficult economic situation, consumer restraint and competition from the Far East."
Maerklin has been owned since 2006 by a British investor, Kingsbridge Capital, and investment bank Goldman Sachs.
The company already has been on a restructuring drive, closing a plant in Sonneberg, Germany that employed 400 people. However, it said Wednesday that the measures taken so far "have not made an impact in the originally planned cost and time frame."
Maerklin said that its credit lines from banks had expired, and that "despite intensive negotiations, the banks did not extend these credit lines for Maerklin."