Syntax-Brillian Files for Bankruptcy
July 9th, 2008by Paul Gagnon, Director, North American TV Research
Syntax-Brillian (BRLC), plagued by financial and supply chain issues, filed late Monday night for Chapter 11 bankruptcy protection, an end that many have been anticipating for months following numerous management, financial and market disruptions since Q3′07. While the company continues to ship Olevia LCD TV products for now, the outcome for the Olevia brand is uncertain. Syntax-Brillian’s Q1′08 LCD TV shipment share in North America was 1.3%, ranking #13, down from 4.8% a year earlier.
In their press release, Syntax-Brillian states their intention to sell LCD TV assets to the TCV Group, a manufacturing partner, in exchange for TCV’s assumption of $60M of Syntax-Brillian’s debt. The nature of the transaction is interesting, as the TCV Group will create a new company called the Olevia International Group, LLC which will presumably continue selling Olevia branded televisions. What the distribution or product development implications are is unclear, so the brand could continue in the US or shift distribution to other regions. It is certainly a difficult time for brands to hold on to market share in North America, let alone grow or reestablish themselves, with Sony and Samsung pursuing aggressive growth and slowing growth in the LCD TV category as it matures.
Syntax-Brillian also announced that they expect to be delisted from the NASDAQ stock exchange following a month of consecutive trading at less than $1, and will not attempt to regain listing, leaving remaining shareholders with worthless shares. Shareholder lawsuits are still pending, but under chapter 11 protection and the sale of almost all assets, not much will remain to collect. Separately they also announced their intention to sell the Vivitar digital camera business.
Tough times indeed.
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