Solid-state storage specialist OCZ has filed for bankruptcy, with Toshiba in the frame to pick up the company’s assets, following the failure to repay a business loan.
OCZ has been forced into bankruptcy following the breach of terms of one of its loans, with Toshiba claimed to be looking to pick up its assets.
The company, which recently discarded numerous product lines to focus entirely on solid state storage, has formally announced that it has been found in breach of the terms of a loan from investment group Hercules Technology Growth Capital. The result: Hercules has taken exclusive control of the company’s bank accounts, leaving it with no choice but to enter bankruptcy proceedings.
OCZ claims to have received an offer from Toshiba which will see the company acquire ‘substantially all of [OCZ’s] assets in a bankruptcy proceeding.
' The agreement, OCZ explains, is subject to several terms: the perceived value of the company’s business must be maintained, employees must be retained, and Toshiba’s offer must be accepted by the bankruptcy court as the highest and best offer. It’s this latter which could lay the company’s plans low: if a rival corporation places a higher bid with the court, they - not Toshiba - will walk away with OCZ’s assets.
Toshiba enters the fray in a strong bargaining position, however. OCZ has indicated that if it is unable to reach an agreement with Toshiba, it will immediately file a petition for bankruptcy and liquidate - which would be bad news indeed for owners of its hardware, who would lose any outstanding warranty periods as a result, as well as the company’s numerous employees.