Commodore International declared itself insolvent on April 29, 1994 under Chapter 7 of US bankruptcy law. Ordinarily, this would have been followed immediately by an auction of all the company’s assets. However, Commodore’s Byzantine organizational structure—designed to serve as a tax shelter for financier Irving Gould—made this process far more lengthy and complicated than it should have been.
During this time, Commodore UK, Ltd. continued to operate. It had been the strongest of all the subsidiary companies, and it always had a positive cash flow. As the other subsidiaries went under, Commodore UK purchased all of their remaining inventory and continued to sell Amigas to British customers.
The head of Commodore UK, David Pleasance, hatched a plan to purchase the mother company’s assets at auction. His idea was to raise enough money not only to buy Commodore International but to fund the new company as an ongoing concern, including the continuation of research and development projects. The business plan was to continue to sell Amiga 1200 and 4000 computers and CD32 consoles while slowly transitioning to next-generation hardware based on Dave Haynie’s Hombre RISC architecture.
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