Trident Microsystems Has Dec. 13 Confirmation Hearing
Approval of the Trident Microsystems Inc. (TRIDQ) reorganization plan will be the topic for a Dec. 13 confirmation hearing. The U.S. Bankruptcy Court in Delaware approved the explanatory disclosure statement on Oct. 22.
Support for the plan by the two official committees was made possible by a settlement. One committee represents creditors and the other is for shareholders.
After filing for Chapter 11 protection in January, Trident sold the businesses and generated $90 million, leaving $71 million at the end of June, according to the disclosure statement.
Before a settlement, the largest impediment to distribution was disagreement over the $73.2 million claim that Trident has against affiliate Trident Microsystems (Far East) Ltd., which is now represented by liquidators appointed by a court in the Cayman Islands.
The settlement provides for the liquidators to receive as much as $14.9 million in cash, allowing unsecured creditors of TMFE to have a recovery of 55 percent to 81 percent on $96.4 million in claims.
Other unsecured creditors with claims against TMFE will be paid 90 percent on claims of $16.6 million.
Unsecured creditors with claims of about $3 million against Trident will be paid in full, allowing a distribution of as much as 28 cents a share for stockholders.
Announcement of the settlement caused a 35 percent decline in Trident’s stock. It closed yesterday at 25 cents, unchanged in over-the-counter trading. Trident’s television business was sold for about $22.5 million in cash to Sigma Designs Inc. (SIGM)Entropic Communications Inc. (ENTR) purchased the set-top box business for $65 million.
Before filing under Chapter 11 in January, Sunnyvale, California-based Trident was developing multimedia semiconductor products for the digital home entertainment market. The company and creditors together decided on selling the assets.
The petition listed assets of $310 million and debt of $39.6 million. The consolidated balance sheet contained in a regulatory filing listed assets of $236.8 million and total liabilities of $112.8 million as of Sept. 30.
For the nine months ended Sept. 30, revenue was $238 million, resulting in a $113.2 million operating loss and a $106.1 million net loss.
The case is In re Trident Microsystems Inc., 12-10069, U.S. Bankruptcy Court, District of Delaware (Wilmington).