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| | Luminus Devices fights to keep the lights on | | 01 Jan 2010 | | An article in the Boston Globe says that Luminus Devices may have to shut down or cut staff if it can't regain access to its source of financing. | | LED maker Luminus Devices, based in Billerica, Massachusetts, is "fighting to keep the lights on" according to an article in the Boston Globe.
Luminus has accused its lender, Hercules Technology Growth Capital Inc. and several related entities, of reneging on a $15.1 million loan and blocking access to its bank accounts.
Unless Luminus can persuade a judge to intervene quickly and allow it to regain access to its cash, the company warned that it might have to shut down or slash its staff, said the Boston Globe.
Hercules said that Luminus’s own projections showed that its cash flow would be wholly inadequate to service its debt. Starting this month, Luminus was supposed to pay Hercules $800,000 per month over the next two years.
Hercules said it had "no real choice but to exercise its rights under the loan agreement" and was justified in seizing Luminus’s bank accounts.
The move seems to have been prompted by predictions by Luminus of significant declines in revenue. The company predicted in November 2009 that it would generate $24.8 million in revenue in 2010, 60 percent less than it predicted last May. And Luminus estimated it would lose more than $29 million in 2010, nearly double the amount it initially predicted six months earlier.
Based on the revised numbers, Hercules said it was clear that Luminus’s “ability to repay the loan declined significantly.’’
| | COMMENTS | | Name: luminus customer Posted: Wed, 06 Jan 2010 22:01 |
| Now this is an American Company with deep IP that we need to keep going. A perfect application of stimulus funding that will undoubtedly pay back over time in the HB LED market from this technology leader. We as an industry need to help them get over the RPTV cliff that sank them. Of course they should also lean out a bit too. Luminus we are pulling for you and need your industry leading products like the PT-121 line, hang in there guys. | | Name: luminusrocks Posted: Wed, 06 Jan 2010 23:01 |
| I really hope Luminus can continue. I love their LEDs and have several designs in the works. What does a guy do when he incorporates high-power LEDs that come from only one source? | | Name: led pragmatist Posted: Thu, 07 Jan 2010 17:01 |
| It all boils down to how the business is run and the cost structures in place. Technology alone cannot be an end to all means. Yes, the Luminus devices LEDs are bright, but US cost structure is completely uncompetitive for this marketplace. I guess they have to bite the bullet one way or the other. | | Name: lightuplaw Posted: Thu, 07 Jan 2010 21:01 |
| Even if Luminus goes under, the IP will be there for purchase or licensing. The money will simply go to the lenders and the technology to someone savvy enough to swoop in on this opportunity. Perhaps management is putting together such a package. | | Name: designer Posted: Fri, 08 Jan 2010 14:01 |
| Hopefully Luminus will get the cash to stay open. Even if they close their doors and someone buys the IP, it will take too long to get back on track. Luminus has some of the best executed monolithic technology on the market. It's a tight market with a ton of competition. Any hiccup like this will put them, or future owners, behind the development 8 ball. Not to mention I really want to use their product and not restart my own search for an acceptable alternative! | | Name: man under lights Posted: Sun, 10 Jan 2010 19:01 |
| I have been told that they have access to the money now and will continue doing business. Are they taking care of the employees they cruelly dumped without severance pay? Who does that? | | Name: busylifemeto Posted: Thu, 08 Apr 2010 07:04 |
| Iam an Australian and a foundation member of the Australia made Foundation so a fiercly loyal Australian. I am potentially large user ater having spent a lot ofmoney on R&D and just found this article. With the East meaning predominantly Chinaand Korea having a dominance in the manufacture of LEDS, what commecial lunatic would attempt to do this venture in the USA ? is the technology so revolutionary they will not copy it ? Why did they not take the IP and approach one of the better independants and do a JV ? The mind boggles on the stupidity. Administrators Reply Not sure why you are refering to Australia, but please consult http://www.ledsmagazine.com/news/7/2/22. |
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