Spansion Files for Bankruptcy Protection in the U.S.
Bankruptcy
Spansion Inc., the U.S. maker of memory chips for mobile phones, filed for bankruptcy protection to restructure its debt after failing to make an interest payment on $266 million of bonds.
The company listed debt of $2.4 billion and assets of $3.8 billion as of the end of the third quarter of 2008 in Chapter 11 documents filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware.
Spansion announced plans to cut 35 percent of its workforce on Feb. 23, after missing a second payment deadline on the notes. The Sunnyvale, California-based company hasn’t made a profit since it was spun off by Advanced Micro Devices Inc. in 2005, and has been hurt by slackening demand for semiconductors.
Spansion continues to explore strategic opportunities while attempting to restructure debt and focusing on operations with profit-generating potential, the company said yesterday.
“Chapter 11 provides the most effective means for Spansion to preserve its business,” Chief Executive Officer John Kispert said in a statement. Four subsidiaries also sought protection.
The shares slumped 60 percent to 2 cents in Nasdaq Stock Market trading at 9:56 a.m. New York time. They have fallen 99 percent since reaching a 52-week high of $3.70 in May.
The 65 largest unsecured consolidated creditors are owed $951.1 million, court papers show.
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