Amherst Set To File Chapter 7 Bankruptcy Liquidation

Amherst Executive Chairman Gerald Birin would not comment.

The filing comes with IBM Credit trying to sell Amherst to ePlus Technology, a Herndon, Va., solution provider, for about $2 million and assumed debt. On Monday, Judge J. Michael Deasey of the U.S. Bankruptcy Court for the District of New Hampshire in Manchester approved a motion from IBM Credit to lift a stay, allowing IBM Credit to seize collateral securing its $32.7 million loan. Deasey also converted the case to a Chapter 7 liquidation, and appointed a trustee to oversee it.

The Chapter 7 filing comes after ePlus announced last week that it had signed an exclusive letter of intent to purchase the operating assets of Amherst for $2 million in cash. ePlus would not comment on the Amherst situation. But an ePlus source said the company is committed to purchasing Amherst's operating assets and retain key personnel. Furthermore, there will be no disruption to any customer orders or business relationships, the ePlus source said. The ePlus acquisition follows similar deals that the solution provider has successfully completed, buying Manchester Technologies in 2004 and Elcom in 2002. In those cases, ePlus retained all of the customers and branch locations.

ePlus had announced the Amherst deal last week. At that time, ePlus said the deal would close this week, noting that it would be subject to mutually acceptable documentation and other customary terms and conditions.

ePlus also agreed to assume certain Amherst liabilities. Amherst currently has branches in Texas, California, Florida and New England. In a prepared statement last week, ePlus CEO Phillip Norton said he was "very pleased to be adding to our national reach with these new branches, gaining new customers, and welcoming new associates to ePlus."