MTI Technology files for bankruptcy, going out of business.

***UPDATE 3*** A press release just popped up stating: “MTI also announced today that, due primarily to continued operational and financial difficulties experienced by its U.S. operations, it has filed for bankruptcy protection pursuant to Chapter 11 of the U.S. Bankruptcy Code.”  Bye bye MTI.

My company has used MTI Technology OTC:MTIC.pk for some EMC storage and VMware projects.  There have been signs that they were in trouble since May.  I got a letter from their CEO in May stating that some sales people had left, but everything was fine and they were still the #2 EMC reseller.  That was weird, so I started looking around and found out that MTI was being de-listed from NASDAQ.  I was then contacted by some of the departed sales people who wanted me to do business with them at their new company.  Then more and more people that I dealt with from MTI left.  Finally, I wasn’t getting calls returned from MTI employees I know.  I eventually got in touch with someone I know that used to work at MTI.  That person told me that “no one really works for MTI anymore.”

My understanding is that MTI has let go of almost everyone and they are on their way out.  I’m not totally surprised.  MTI was an IHV that attempted to transform itself into a VAR.  They sold only EMC Storage.  They also sold EMC and VMware software.  They did a decent job with the EMC storage, eventually becoming the #2 EMC reseller behind only Dell.  They always behaved as if Sales and Project Services were different organizations.  They never behaved as if they were on the same team, which caused them unnecessary problems.

It’s unfortunate to see MTI go. 

*UPDATE* It appears that my info and instincts are correct.  MTI defaulted on a loan from Comerica and a prommisory note from Pencom Systems Inc..

*UPDATE 2* One of my sources confirmed what I learned last week.  They said that all sales and project people were let go.  The also said some support staff remains to deal with commitments.  They said that MTI will try to do the right thing for their customers.  That remains to be seen.

This post is based on information I have received from people associated with MTI that are in the know and my opinion of their services.  If you have information that proves MTI is staying in business, I’ll gladly retract this post.