Infinite Technology Group Files Chapter 11

Infinite Technology Group, a Mineola, N.Y.-based Sun Microsystems solution provider that only two years ago rode the Internet build-out wave and even considered an initial public offering of its stock, filed a voluntary petition for Chapter 11 bankruptcy protection earlier this month.

According to a copy of the petition, which was filed May 10 in U.S. Bankruptcy Court for the Eastern District of New York, the company experienced a large decline in sales over the last year, down from a peak of $80 million a year in revenues to less than a quarter of that amount.

"Due to this decline in sales without a corresponding percentage reduction in administrative, operating and overhead expenses, the debtor is unable to obtain new availability under its current bank lines to fund operation," said the filing, a copy of which was obtained by VARBusiness.

According to the filing, ITG listed debts of $12.7 million and assets of $5.2 million.

Less than two years ago, ITG was riding a strong wave of business generated by the Internet build-out. And last June, the company invested in a $1 million video production studio to create streaming videos, Webcasts and other multimedia services. At the time, the company's CEO Jim McGowan said the studio was going to differentiate ITG's services in the solution provider marketplace by giving customers the ability to integrate multimedia productions into their mission-critical processes. The move, he said, was part of the company's evolution from a traditional product reseller to a systems integrator to what it considered a "full-service, multimedia company."

Unfortunately, the company, which does a large chunk of its business with financial services firms in Manhattan, saw its business significantly impacted by Sept. 11, as "plans for expected business were either put on hold or canceled altogether."

"The debtor can trace the source of its recent financial condition to the reduction of business and sales for the past year," said the filing.

The goal now is to restructure the company under bankruptcy protection to make it a smaller, more efficient firm, says the company, which has hired Nachman Hays Brownstein Consulting to reorganize its finances.

ITG is the latest Sun solution provider to face financial difficulties. Late last year three others-- Aztec Technology Partners, Stonebridge Technologies and GoBosh--filed for Chapter 11 protection in an effort to reorganize their businesses.