Troubled Genisco Technology Sells Division, Main Product Line : Deal: Announcement comes less than a week after Anaheim firm filed for Chapter 11 protection.
Less than a week after filing for Chapter 11 bankruptcy protection, Genisco Technology Corp. said Tuesday that it has sold its filter division and one of its main product lines to a Minneapolis firm for $570,000 in cash.
The acquisition by Potter Production Corp. was completed on Feb. 9. That was eight days before Genisco Technology filed for Chapter 11 reorganization, listing assets of $4.9 million and debts of about $9 million.
Despite the timing of the sale, Genisco’s attorney, Thomas W. Dressler, said Tuesday that he has had no complaints from Genisco’s approximately 150 creditors. “It was a long-pending, pretty ordinary sale for a good price,” Dressler said.
The sale by Genisco, an Anaheim-based maker of customized computer equipment, included Genisco Electronics and the Eldema Indicator Lites line of filters. The sale included a Genisco plant in Tijuana and inventory.
A spokeswoman for Potter said all 46 employees from Genisco Electronics and Eldema will continue with Potter--a company with about $9 million in annual sales and 175 employees.
Genisco Technology filed for Chapter 11 after an offshore equity-financing deal it tried to arrange fell through last month. Also in January, the company was removed from the American Stock Exchange and its chairman, Harmon Hardy, resigned and President Jerome Gross stepped down from the board. Company officials did not return telephone calls Tuesday.
In its latest fiscal year ended Sept. 30, the company reported a loss of $3.2 million on revenue of $9.1 million. In the previous fiscal year, Genisco Technology posted a loss of $4.7 million on revenue of $12.7 million.
