Former computer animation company Silicon Graphics (SGI) is to emerge from five months' Chapter 11 bankruptcy protection in October, after a New York judge approved the company's financial reorganisation package.
SGI has organised a loan of US$85 million from Morgan Stanley and a US$30 million line of credit from GE Capital to eliminate its outstanding debts.
As part of the reorganisation, SGI has cut its workforce from 2,200 to 1,600 leading to a US$150 million a year annual reduction in costs.
"We have re-engineered the company and have a strong leadership team that will be executing this plan," said Dennis P. McKenna, chief executive at SGI.
"Also of significance to the growth of the company is that during this time, we retooled and aligned our product portfolio to the strategic direction of the company."
SGI was best known in the early 1990s for its proprietary computer graphics hardware and software, such as Mips processors and the Irix operating system, and its role in creating high-profile CGI effects for movies like Jurassic Park.
But with the growing power of industry-standard processors, much of its market evaporated. SGI has now adopted Intel Itanium-based hardware and repositioned itself as a vendor of high-performance computing systems.
Silicon Graphics to rise from Chapter 11
By Andrew Charlesworth on Sep 25, 2006 9:57AM