Cloud storage startup Nirvanix that imploded last month, has formally admitted business defeat by filing for Chapter 11 bankruptcy. It announced the fact on its website on October 1, saying: On October 1, 2013, Nirvanix voluntarily sought Chapter 11 bankruptcy protection in order to pursue all alternatives to maximize value for …
maximize value for its creditors?
The whole idea of chapter 11 is they can make their pre-petition creditors (suppliers) wait until after the reorganisation is complete. While in chapter 11, the company runs up post petition debt (with bankruptcy lawyers) that get paid if the bankruptcy court approves the bill. A competent law firm should be able to suck the company dry within a couple of years and build up enough debt to collect the entire proceeds of chapter 7 bankruptcy liquidation.
Surely a famous firm of professional analysts like Gartner would have seen this coming...
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