Crippled by the after-effects of much over-enthusiastic order-booking and dud product shipping, and facing a barrage of shareholder lawsuits, Winchester disk drive manufacturer MiniScribe Corp yesterday bowed to the inevitable and filed for protection under Chapter 11 of the US Federal bankruptcy code. The filing covers only the US parent and not the Far East subsidiaries, where most MiniScribe manufacturing is done. The Hong Kong arm of Standard Chartered Plc has agreed to provide up to $20m financing to enable operations to continue provided the bankruptcy court approves. Merrill Lynch & Co has been retained to help develop a recapitalisation and reorganisation plan for the company. The bankruptcy likely means that existing shares will prove worthless – the company had a substantial negative net worth in October, and it has deteriorated.
