How much more rot and corruption is out there? For years the mantra was to let markets make the decisions and corrections. Did markets drive oil to $150 and down to close to $30 within months? How many companies have been raided and dismantled by nothing more than greed? Were the private equity guys any different from the boys in the hood stripping copper wires from vacant buildings?
Steady on, I fear there is worse ahead.
Polaroid, Following Parent Company, Seeks Bankruptcy Protection
By Michael Bathon
Dec. 19 (Bloomberg) --
Polaroid, 2 1/2 months after the founder of its parent company was arrested on fraud charges, filed for bankruptcy protection from creditors.
The 70-year-old photography-film maker said it made the filing to “facilitate” its financial restructuring. The Minnetonka, Minnesota-based company didn’t list a range of assets or debt in Chapter 11 documents filed yesterday in U.S. Bankruptcy Court in Minneapolis. Its parent, Petters Group Worldwide LLC, filed for bankruptcy on Oct. 11.
“The financial-structuring process and the bankruptcy filing are the result of events at Petters Group Worldwide, the company that has owned Polaroid since 2005,” Polaroid said in a statement distributed by PR Newswire yesterday.
Federal prosecutors accused Tom Petters, founder of the Petters Group, of leading a more than $2 billion fraud at the company. Petters Group was also indicted. Polaroid said it isn’t a target of the Federal Bureau of Investigation’s probe.
Lorrie Parent, a Polaroid spokeswoman, didn’t immediately return a call for comment left after business hours.
Petters resigned as Petters Group chief executive officer Sept. 29 after the FBI received information that at least 20 investors may have been victims of a lending scam and raided the company’s Minnetonka headquarters. Petters has been jailed since his arrest on Oct. 3.
“Polaroid has entered bankruptcy with ample cash reserves sufficient to finance the company’s reorganization,” it said in the statement. “The company has not sought, nor does it expect to seek additional debtor-in-possession financing.”
The case was filed by Douglas A. Kelley, Petters Group’s court-appointed receiver. Kelley put Petters Group into bankruptcy after a judge ordered its assets to be frozen.
Sun Country Airlines Inc., another unit of Petters Group Worldwide, sought bankruptcy protection Oct.6 for the second time in seven years. Sun Country said it filed for protection from creditors because of the raid on Petters Group and to retain control of its assets rather than have them frozen and under a receiver’s control. The company said its assets and debt are each less than $100 million.
Sun Country said its 20 largest creditors without collateral backing their claims are owed about $256.8 million. Petters Capital LLC is listed as the largest unsecured creditor, with a claim of $184 million.