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.

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7 responses to “MTI Technology files for bankruptcy, going out of business.

  1. You’re absolutely right, this company and all of the
    losers still employed there are out of business. Good luck getting any support.

    I guess you can always try http://www.colltech.com
    if you’re really desperate.

  2. Way to insult your former c0-workers Larry. Were we ALL morons?

    Yes Harry you hit it spot on; sales and services were like oil and water. A situation probably encouraged by the CEO’s brilliant leadership; a man who was too afraid (or perhaps just too dense) to communicate with his own employees.

  3. Just My Opinion

    It is a sad case when an CEO (TR) is going to recieve back vacaction pay and other perks during this BK…..When they knowingly defrauded in my opinion all the employees out of thier back vaction pay, since they did not pay it. Along with back commisions and expenses.

    SHAMEFUL

  4. I am one of the unfortunates that MTI
    contracted to, to work a project. The project
    start 10 Sep and we were instructed to invoice
    weekly with terms of 30 days net. The first
    invoice payment was due 17 Oct. I still have two
    outstanding expense reports and 6 weeks of
    billing that will never get paid. Yet MTI will still
    get paid for hours I worked, the bankruptcy
    court will see to that.

  5. Wow. They had major layoffs during 2000 I guess they just couldnt get their act together. Well most of their employees went to Veritas, Avamar/EMC and such. I did like their Anaheim location and missed going there

  6. This bankruptcy was, in my opinion, a sham that stole the equity of the profitable European operations away from the shareholders of the stock while it was on Pink sheets and put it in the hands of some insiders.
    Here was the 2007 news:
    “In a separate move, the company said it will sell its European operating subsidiaries to Zinc Holdings, a private equity-sponsored group, for $5.5 million. Because the bankruptcy filing only applies to the company and not its subsidiaries, MTI expects the European operations to continue while in bankruptcy and the sale will close by the end of the year.”
    That sale was an inside job. They made no effort to sell the business on behalf of the shareholders.
    From their own web site operating MTI Europe today:
    “In late 2007 the consistently profitable European companies were sold to Garnett and Helfrich Capital (The Venture Buyout Fund) as one autonomous entity. Today the company is led by Keith Clark, President and CEO and is engaged in an aggressive expansion programme.”
    “Keith Clark has been responsible for MTI Europe for the last 11 years of his 21 years with the Company. He was also World-wide COO for MTI Corporation USA before the separation of the two companies in November 2007.”

  7. There’s certainly a great deal to know about this topic. I love all the points you’ve made.

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