The group, which sold lingerie, erotic films and sex products, was no longer able to service its debt -- 30 million euros of which were due for repayment in 2019.
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It wasn't the last time Kolle would come up against censorship in the film industry.
The filmmaker said he spent two days and two nights wrangling with Germany's motion picture ratings authority over individual scenes in "The Miracle of Love." Kolle's eight films have been seen by 60 million viewers.
Beate Uhse set up her first store in the northern German city of Flensburg in 1962, which she called Institut fuer Ehehygiene, or Institute for Marital Hygiene, and grew the firm to be at one stage the world’s largest sex retailer by revenue.
The company currently has around 345 employees in seven countries.
His two-part film, "The Miracle of Love: Sex in Marriage," premiered in January 1968.
It was a box-office hit around Europe, but the feature was censored in Belgium and parts of Switzerland.
After Germany relaxed its anti-pornography laws in the 1970s, Uhse's business flourished.
Uhse became a household name in Germany, and with characteristic panache she laid on a remarkable show to mark the flotation of the company in 1999 on the MDAX in Frankfurt.
Named Institute of Marital Hygiene, the store selling lingerie and contraceptives became the world's first sex shop.- Basic human need -Her activities often ran counter to the morality of post-war Germany and she was called before the courts in thousands of legal suits filed against her.
Yet she remained frank and unashamed about selling erotic ware.
The company, started in 1946 by a former female pilot with the same name, said on Friday the insolvency did not apply to its subsidiaries, which means its shops will remain open as it tries to restructure.