Friday, February 20, 2009

Courts approve Polaroid auction of itself

By Mass High Tech staff

Polaroid Holdings Co. of Waltham has been granted U.S. Bankruptcy Court approval to sell its assets in an auction scheduled for March 30, according to published reports.

The “stalking horse” agreement enables lead bidding from PHC Acquisitions LLC, an affiliate of Genii Capital SA, a Luxembourg-based private equity firm and an investor in Polaroid spinout Zink Imaging Inc. of Bedford. PHC has offered an initial bid to buy Polaroid for $42 million, plus assumption of liabilities, Reuters has reported.

The auction bid has attracted criticism, the report says, from creditors who argue that the $42 million bid significantly undervalues Polaroid’s assets. Petters Group Worldwide, the company whose founder faces fraud allegations, bought Polaroid in 2005 for $426 million, Reuters states.

In December, the camera maker filed for Chapter 11 bankruptcy protection. Last month, Polaroid CEO Mary Jeffries said in a statement entering into the agreement marks progress in Polaroid’s financial restructuring and provides a key milestone on the path out of bankruptcy protection.

Zink, a maker of thermal printing products for portable devices such as cell phones, was spun out of Polaroid in 2005, but has worked closely with the company since.