Financial Woes Hit Firm Tied to Soviet PC Deal

With its ambitious plan to sell millions of computers to the Soviet Union apparently now up in smoke, Phoenix Group International has filed for Chapter 11 bankruptcy protection.

Phoenix, an Irvine holding company that controls several high-tech operations, listed liabilities of $939,469 and unspecified assets, according to a bankruptcy petition filed Tuesday in federal court in Santa Ana.

Two weeks ago, Phoenix’s Netcom Research subsidiary also filed for bankruptcy protection, listing debts of $1.65 million.

The computer deal--a joint venture between Phoenix and Soviet concerns--was announced with great fanfare at a New York press conference attended by top Soviet trade officials in September, 1989. Phoenix Chairman Charles Missler later described the agreement as the “deal of the century” and said it could generate billions of dollars of sales for his tiny company.

Missler boasted that the company had beaten out 16 competitors, including “every major computer company in the world,” to win the contract to supply up to 6 million PCs to schools and businesses in the Soviet Union.