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Mobclix files Chapter 7 bankruptcy

The free market provides many opportunities for enterprising businesses to earn a healthy profit when they make smart decisions. However, the free market may also allow for a company to find itself in financial difficulties if the company does not make the right business choices in Texas or in any other state. One company seems to have found itself in this situation and recently filed for Chapter 7 bankruptcy.

Mobclix has decided to shut down its business operations by filing a Chapter 7 bankruptcy. The company is a subsidiary of Velti Plc, which has decided to sell much of its business to Blackstone Group LP. Velti has decided to sell parts of its company located in the United States as well as two other countries to Blackstone. The remaining parts of the company ended up filing for Chapter 11 bankruptcy.

Blackstone's credit division, GSO Capital Partners LP, promised to lend $25 million of debtor-in-possession financing to the operations being purchased by Blackstone. This means that Velti will still be in possession of the operations, however Blackstone has a lien on the property. Part of this financing will include an immediate investment of $10 million in cash in order to maintain the newly purchased U.S. operations.

Businesses and individuals who find themselves in financial difficulties similar to Mobclix and Velti may want to also consider filing bankruptcy in Texas or in any other state. However, it is important to choose the correct type of bankruptcy to file. Individuals may choose to file a Chapter 7 bankruptcy because it is designed to discharge unsecured debts such as credit card debts. Businesses that file this type of bankruptcy will discharge all debts owed by the company, however, the business would cease to exist as a legal entity.

Source: Reuters, Velti to sell businesses to Blackstone, US ops file for bankruptcy, No author, Nov. 4, 2013

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