Former Macintosh cloner Power Computing Inc is to shed 150 of its 250 employees as the ramifications of the $100m buyout of its core assets by Apple Computer Inc (CI No 3,239) sink in. Apple agreed to buy the intellectual property rights, product line and customer base relating to Power’s cloning business at the end of September, following its decision to discontinue its Macintosh clone licensing program. But the deal has not yet been completed, and Power has yet to receive the cash as it awaits regulatory approval. Power is still selling the clones for the time being – it has until the end of the year – and ironically, it says sales have never been better. The company has just reduced the number of staff in its engineering division by 18, the first in a long line. The future for Power Computing will lie in the Wintel compatible notebook, personal computer and workstation markets. The company has just started shipping its Intel Corp-based PowerTrip Wintel notebooks (CI No 3,239). If things weren’t already bad enough, Power Computing has been hit with a $42.75m law suit from a former supplier who claims it canceled large orders without notice. Canadian owned, Taiwan-based TCI Manufacturing Ltd used to supply Power Computing with computer castings and internal power supplies. Power denies the charges and claims it gave TCI the required 30 day notice period to cancel orders. TCI argues that the agreement it had with Power Computing required a 120-day notice period. Power Computing’s vice president of business development says the company is not at all worried by the lawsuit and says in fact TCI owes it some $1.5m in undelivered products. He says: If they can ship us the product we’d be delighted, if not Power wants its money back. TCI is set to lay off 35 of its 40 person workforce and is claiming its loss of the Power Computing order is putting it out of business.
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