Bankruptcy judge OKs 18 April auction for Powerwave Technologies
Wireless-equipment maker Powerwave Technologies Inc. got permission from a bankruptcy judge to put its business on the auction block next month.
Executives at the Santa Ana, Calif.-based company, which filed for bankruptcy on Feb. 28 blaming the unstable telecom-equipment market, said the auction will raise money to back its debts, which include a $35 million loan from an affiliate of distressed-debt investor Gores Group and $256 million owed to bondholders.
Chief Executive Ronald Buschur said that the company has a valuable technology patent portfolio that, according to regulatory filings, included more than 240 U.S. patents and 500 foreign patents as of February 2012.
Judge Mary Walrath of the U.S. Bankruptcy Court in Wilmington, Del., determined that the company’s proposed bidding rules were fair after a court hearing held Monday, according to court papers. The rules give Powerwave executives until March 12 to find and select a lead bidder for the auction whose offer would set the floor price in advance, the papers said.
All bidders have until April 4 to put in offers for the company, which has made and sold products like antennas, radio frequency power amplifiers, remote radio head transceivers and tower-mounted amplifiers, according to filings with the U.S. Securities and Exchange Commission. The company has operated manufacturing plants in China and Thailand, and it also has relied on contract workers in Europe and India.
The company’s financial hardship lingered beyond the global economic recession, the company explained in earlier regulatory filings. And declining demand for its wireless equipment from customers like Nokia Siemens Networks, Alcatel-Lucent and Samsung Electronics Co. Ltd. caused Powerwave to lower its prices in recent years.
“Continuing economic weakness and uncertainty, increasing energy and commodity costs, continued low consumer confidence, reduced property values, constrained credit markets and concerns about sovereign debt in some countries in the European Union have had a negative impact on the availability of financial capital, which has limited capital expenditures by wireless network operators,” the company said in earlier regulatory filings.
The company, which had more than 2,100 workers as of early 2012, closed its manufacturing facility in Salisbury, Md., moving that work to Asia and relocating its headquarters to Santa Ana, Calif.
PowerWave executives put the company under Chapter 11 protection after the Gores Group affiliate, which extended its $35 million loan last fall, took more than $8 million from its bank accounts.