Equipment-leasing and data storage firm Comdisco has filed for Chapter 11 bankruptcy protection and has agreed to sell most of its technology services unit to Hewlett-Packard for $610 million.
The Rosemont, IL-based company was founded in 1988, and was a prominent imaging equipment leasing and computer solutions company, with up to 4,000 employees a year ago. That number was down to about 2,300 when the bankruptcy filing was announced July 16.
Comdisco's financial picture began to darken when it made a number of risky investments in technology start-ups, particularly when it acquired Prism Communications in February 1999.
Comdisco bought the high-speed connectivity company for about $52 million cash, and provided Prism with $478 million for expansion and operating costs. Prism ceased operations in October 2000, and Comdisco absorbed the loss. Coupled with losses in its ventures group, Comdisco could not generate enough cash to retire all its debt, according to company CEO Norman Blake, Jr.
In addition to sales and leasing of new and used imaging equipment, Comdisco engaged in procuring and placing new and used computer equipment. The company moved into the digital image storage market with its RSNA debut last November with an application service provider (ASP) model and pay-per-use storage.
The PACS services segment is not included in the H-P buy offer. Some analysts believe that offer is low and that other suitors may emerge. Comdisco has a joint ASP PACS venture with Siemens Medical Solutions, and recently signed a pact with SGI for managed storage and development of ASP technologies.
By AuntMinnie.com staff writersJuly 20, 2001
Related Reading
Comdisco enters ASP storage marketplace, November 29, 2000
Integration Resources to partner with Comdisco, March 7, 2000
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