Alvarion Finally Files for Bankruptcy
Published on: 15th Jul 2013
By: Ian Mansfield
Troubled Israeli wireless equipment vendor Alvarion has finally agreed to appoint a receiver and wont be contesting an attempt by a US bank to secure a winding up order.
In a blunt statement, the company said that it "has decided not to object to the request submitted by Silicon Valley Bank to the District Court of Tel-Aviv - Yaffo for the enforcement of liens registered in connection with a loan extended by SVB to the company, and for the appointment of a receiver to enforce such liens."
In plain English, the company was late in repaying US$3.2 million of a US$30 million loan that it had borrowed to fund the acquisition of Wavion in 2011.
The lender sought a winding up order, and the company has decided to accept the long expected inevitability of a bankruptcy order.
The WiMAX to Wi-Fi vendor was formed in 2001 from the merger of BreezeCOM and Floware and was at one time valued in excess of US$1 billion. The collapse of the WiMAX market hurt the company, and its move into Wi-Fi came too late to turn around the business.
A group of company employees have also launched a lawsuit seeking payment of wages for this month in light of the bankruptcy order.
The winding up of the company is also bad news for Clal Finance, which only a few weeks ago agreed to buy a 10.5% stake in the company for US$1.2 million. That stake is now almost certainly going to be written off.
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