Say Goodnight Comdisco

Nearly a year after filing for bankruptcy protection, the Illinois company has finds it has three years to sell of its assets and shutter its doors for good.

by Brian Morrissey of internetnews.com [June 17, 2002]

Nearly a year after Comdisco filed for bankruptcy protection, the formerly high-flying computer services company said it reached an agreement with its committees of creditors and shareholders on a three-year plan to sell its remaining assets.

"This will allow us, in an orderly fashion, to determine how to sell them off," said Comdisco spokesperson Mary Moster. "We're going to try to maximize the value."

Although Moster said the plan would allow it to emerge from bankruptcy in August, she confirmed the plan would mean the effective end of the Rosemont, Ill., company in 2005.

Comdisco continued the unloading of its leasing division, which was the company's biggest revenue generator. Last night, it closed the sale of its health-care leasing assets to GE Capital for $117 million. GE Capital also paid Comdisco $24 million in a second closing for Comdisco's electronics, lab and scientific assets. GE Capital paid $548 million in a first closing two months ago.

Comdisco's fire sale has been in the works since April 2001, when it retained Goldman, Sachs and McKinsey to explore options for emerging from a financial cloud created by bad loans, a sagging venture division, and a failed broadband division. In July 2001, the company filed for bankruptcy.

In February, Comdisco received bankruptcy court approval for the sale of its IT control and predictability unit to T-Systems. Last October, Hewlett Packard swooped in to pick up Comdisco's Availability Solutions business for $750 million.

With the runoff and the company's cash, Comdisco said creditors would recover about 90 percent, while shareholders will not fair as well, recovering as little as 3 percent and a maximum of 37 percent. The voting on the plan begins next week, concluding on July 19.

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