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Technology Stocks : SYQUEST -- Ignore unavailable to you. Want to Upgrade?

To: Jonathan S. Feingold who wrote (7536)	12/9/1998 12:27:00 AM
From: Philip J. Davis	Read Replies (1) \| Respond to of 7685

NEWS: Iomega is in serious contention to purchase Syquest... SyQuest Deal Still A Possibility By Joseph F. Kovar Fremont, Calif. 8:09 PM EST Tues., Dec. 08, 1998 .............. The sordid saga of SyQuest Technology Inc. continues, although an end may be in sight. SyQuest's current troubles started on Oct. 28 when a major lender decreased the storage maker's line of credit. The company closed its doors five days later on Nov. 2. In the days following SyQuest's collapse, a white knight appeared and expressed interest in buying the company's technology and intellectual property. "We delayed filing Chapter 11 Bankruptcy for so long because the discussions were going so well," said a source close to the negotiations. The source said removable storage rival Iomega Corp., Roy, Utah, was the potential buyer. "But they wouldn't make an offer, because they didn't want to assume any liability," the source said. "This also gave them an opportunity to buy only the technology pieces they wanted." SyQuest offcials finally filed for bankruptcy protection with the U.S. Bankruptcy Court in Oakland, Calif. on Nov. 18 to protect the company's remaining assets. SyQuest then immediately signed a letter of intent for sale to Iomega of all its assets, including patents, intellectual property, manufacturing and development equipment, finished goods and raw material inventory. But the court extended the Nov. 25 deadline for resolution of the sale until Dec. 9, in part because a second suitor made a bid for what remained of SyQuest, based here. The source would not reveal the other potential buyer. "We all secretly hoped that things would work out and the white knight would come in, but it fell through at the eleventh hour." If that had happened, he said, SyQuest's finished goods could have been rushed to market for the lucrative Christmas buying season. The source said that if the court acts quickly, it would still be possible to recover some holiday sales. Though the parking lot is empty and the building apparently deserted, "there still are people working in there, trying to hold things together until the courts decide what to do," the source said. "But the core of the company is gone,out there looking for jobs." The court's decision on a buyer could come as early as Wednesday. "I still have a deep desire that someone will come and try and keep the brand alive and, more importantly, support the loyal SyQuest customers,not just buy the technology and put it away," the source said.