SyQuest Sells Select Assets to Iomega Corp.
- By Scott Bekker
- January 13, 1999
SyQuest Technology Inc. (www.syquest.com
) announced today that it has entered into a definitive agreement with Iomega Corp. (www.iomega.com
) to sell certain assets including all of its intellectual property, its U.S. inventory and its U.S. fixed assets for $9.5 million, subject to certain closing conditions and adjustments. This announcement comes two months after SyQuest filed for bankruptcy. The company had been continually losing market share to Iomega in the removable storage market up to the November filing.
SyQuest told the court in November that it was selling the bulk of its assets to another company, but refused to name them at the time. The Iomega purchase takes care of 11 percent of the $85 million SyQuest reported as its debt in the bankruptcy filing.
SyQuest filed a motion today in the United States Bankruptcy Court to seek approval for the sale of these assets to Iomega. Specific conditions to closing the asset sale include Iomega's acquisition of the inventory and equipment assets of SyQuest's Malaysian subsidiary for additional consideration.
As previously announced, SyQuest has commenced limited sales and support operations. This includes online technical support via the Web, warranty returns, and product service operations. The company anticipates adding additional customer service and technical support resources in the near future. -- Brian Ploskina, Assistant Editor
Scott Bekker is editor in chief of Redmond Channel Partner magazine.