As part of its bankruptcy filing and subsequent reorganization, Comdisco could put its medical equipment leasing business on the block. The Rosemont, IL, company has filed a petition with the U.S. Bankruptcy Court in Chicago seeking approval of bidding
As part of its bankruptcy filing and subsequent reorganization, Comdisco could put its medical equipment leasing business on the block. The Rosemont, IL, company has filed a petition with the U.S. Bankruptcy Court in Chicago seeking approval of bidding procedures for its leasing business, which includes the medical equipment sector.
Comdisco announced the sale of its technology services group to Hewlett-Packard for $610 million on July 16, the same day it filed for Chapter 11 protection and announced a plan to pursue “strategic alternatives” for its remaining businesses. The technology series group consists of the company’s corporate Web hosting and “business continuity” services. The healthcare division, which includes the medical leasing business, image storage, and healthcare data security services, is not affected by the HP sale, said Rich Maganini, director of corporate communication at Comdisco.
“We’re continuing with normal business operations,” Maganini said. “And we’re looking at alternatives for other parts of the business.”
Asked to clarify whether those alternatives included the potential sale of assets tied to its healthcare services and leasing division, Maganini conceded that it could. But he would not say how, when, to whom-or even if.
“It depends on how negotiations go,” he said. “It would be premature at this point to say how those will shake out. But they are ongoing.”
The company rolled out a suite of storage and access management services at the 2000 RSNA show, directly targeting the digital image distribution market. It also has joint marketing agreements with Siemens, Agfa, and Mitra Imaging. In May, Comdisco announced it was collaborating with SGI on managed storage and ASP technologies aimed at improving methods for storing digital images. What will happen to these projects is not known.
Operational cash flow and $600 million in debtor-in-possession financing from Salomon Smith Barney are fueling day-to-day operations under Chapter 11. The bankruptcy court has scheduled a Sept. 20 hearing on bids received for leasing and other assets.
“At this point, we’re very focused on continuing to serve our customers, and I think it’s important for people to understand that,” Maganini said. “We’re also communicating with customers as news comes out, in terms of decisions that are being made. We’re looking at the best alternatives for all of our stakeholders.”
Comdisco’s largest business unit is its leasing division, which includes leasing and remarketing of PCs, servers, workstations, routers, and communications equipment. The book value of the firm’s leasing assets was $5.1 billion as of March 31, according to Dow Jones Newswire. In mid-July, the Chicago Tribune reported that Comdisco and GE have settled on a price for the leasing assets, but neither company would confirm that report.
Comdisco is expected to reorganize its remaining businesses and emerge from Chapter 11 early next year. The newly organized company will likely revolve around its existing Ventures Group, which provides leases, venture debt, and direct equity financing to venture capital-backed companies.
Prior to 1999, the company’s healthcare division focused primarily on technology planning and leasing of diagnostic imaging equipment. But Comdisco dropped its refurbishing business that year and instituted a series of initiatives targeted at capturing a piece of the healthcare information technology market. The move was in keeping with the overall transition toward IT-based services throughout the company.