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Job-chopping Chipmaker Bites the Bankruptcy Bullet

Mar 04, 2009, 15:03 (1 Talkback[s])

"Apparently, however, cutting more than a third of the workforce wasn't enough to cover the costs of retaining top executives, forcing the company to file for protection under Chapter 11 of the Bankruptcy Code.

"The move came on Sunday -- an indication, perhaps, of the company's haste to be rid of collection calls -- and was filed in the United States Bankruptcy Court for the District of Delaware, a common location for big-business filings, given the high concentration of incorporation in the state due to Delaware's corporation-friendly taxation. Court filings cite an over-saturated memory market, bad investments to the tune of $122 million, and poor cash flow during the past two years, attributed to price drops and a "sharp decline" in demand, for its woes. The company's filing follows that of its Japanese subsidiary, which sought protection under Japan's bankruptcy laws in early February, bearing nearly a billion dollars in debts."

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