Fusion Garage bites the dust, finally

Updated: 12th January

Like a bad straight-to-video movie where the ending is entirely predictable, many saw this coming. Fusion Garage, unable to return the US$40M it owes to creditors, is finally closing down.

Which means that if accountants find the company unable to pay off its debts, its assets will be sold. A creditor’s meeting will be held this month to determine whether the company should be dissolved, revealed Business Insider.

Prominent shareholders in the firm include Ernst & Young partner Choo Eng Chuan and The Hour Glass executive chairmain Henry Tay, noted The Straits Times. It had also received tens of millions of dollars in investment from Malaysian mobile device maker CSL and other private investors.

Getting to this point, the whole drama was painful to watch and overlong.

Singapore-based Fusion Garage is a company best known for falling out with Michael Arrington, founder of US tech blog TechCrunch over the Crunchpad, a tablet which had the ambition of preempting the Apple iPad. Crunchpad later became JooJoo, but the tablet was widely slammed by reviewers and was soon cut.

It then tried to salvage its reputation with two new products — the Grid10 tablet and the Grid4 smartphone.

The last time SGE spoke to its CEO and founder, Chandra Rathakrishnan, was in August, where he announced plans to launch the Grid10 in Singapore by September and other parts of Asia. Since then, there had been a launch delay as well a drop in price point from US$499 to US$299. The tablet received mixed reviews.

It soon became apparent that there would be no second coming.

Engadget reported in mid-December that the Fusion Garage website went down briefly, only to come back a couple of days later with many broken links. Its Facebook Page had been inactive for months, while the Twitter account saw its last tweet on 10th December. Many customers appear to be left in a lurch without receiving their orders.

Fusion Garage had even ignored its own PR firm McGrath Power, which has since said in a statement: “Unfortunately, none of our efforts have resulted in any communication from the company to the customers. Given all of this, we don’t have any other choice but to cease working with FG effective tomorrow.”

Also, Quinn Emanuel, the law firm representing the embattled company in the ongoing legal trial with AOL (which owns TechCrunch), has requested to withdraw as counsel over the allegation that Fusion Garage has not paid any legal fees, TechCrunch founder Mike Arrington said in a blog post.

After days of complete silence, Chandra spoke. He told Singapore’s Business Times that the company and its intellectual property has been put on sale in order to salvage the situation.

“Everything is being considered,” he told the business daily then, adding that the company is running out of funds and that investors are pulling the plug because they find it too costly to support its rebirth. The staff totaling about 100 have been put on leave of absence.

This explains why some customers had experienced problems seeking refunds on their Grid10 tablets.

This will be the second time a company started by Chandra has folded. The first, mobile software development company Radix, shut its doors in 2007.

According to Mike Arrington however, Chandra may not be done. Mike published a tweet from what appears to be Chandra’s staff implying that the embattled CEO could be launching a new company.

Let’s hope there won’t be a sequel.

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