Top 10 Companies That Went Bankrupt

#10: Pacific Gas and Electric Company

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The Pacific Gas and Electric Company, known primarily as PG&E, is a utility company that provides, you guessed it, gas and electricity to roughly five million people in northern California. California suffered a major drought in 2001, which severely limited the available amount of hydroelectric power. PG&E were subsequently forced into buying exorbitantly priced electricity from out-of-state, which resulted in massive losses. The utility company entered bankruptcy on April 6, 2001. As a result, California lost about $45 billion, and millions of people were forced to pay higher-than-average electricity prices to make up for the debt.

#9: Toys “R” Us

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Toys “R” Us was once one of the biggest toy stores in the world. It was founded in 1948, and subsequently opened nearly 1,800 stores around the world, including 800 in the United States alone. However, due to a large variety of factors (no, not just that kids would rather spend their time with a smartphone), Toys “R” Us filed for Chapter 11 on September 18, 2017. The company had amassed $5 billion in debt and hadn’t seen profit for nearly five years. On March 14, 2018, the company announced that it was closing every one of their UK and American stores, totalling roughly 900 outlets.

Kodak was once THE name in photography and film. The company was founded in 1888, and enjoyed immense prosperity throughout much of the following century. However, the company struggled upon the advent and rise of digital photography, and they were slow to transition to that quickly-dominant trend. They eventually filed for Chapter 11 bankruptcy in January 2012. The company stopped making various products as a result of the bankruptcy and sold off various patents to other companies, to the tune of $525 million. But the company rose from the ashes in September 2013 and continues to operate to this day.

#7: Blockbuster

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The Rise and Fall of BlockBuster

Who didn’t see this coming? (xref) Like RadioShack and HMV, time wasn’t kind to Blockbuster. Blockbuster dominated the video rental market throughout the ‘90s and early 2000s, operating over 9,000 stores and employing 84,000 people. However, with the rise of Redbox, pirating, video on demand (and especially Netflix), Blockbuster lost significant revenue and filed for bankruptcy in 2010. Today, only a handful of Blockbuster stores remain. Many people in the industry blamed Blockbuster for its own downfall, with some citing poor management and senseless business tactics. But hey, at least the closures gave us that hilarious “Last Blockbuster” Twitter account.

#6: CIT Group

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Top 20 Companies That Went BANKRUPT

CIT Group, named after its early title of Commercial Investment Trust, is 550th on Fortune’s 1000 largest American companies list, as of 2018 . However, the financial services giant suffered significant problems amidst the great recession of the late 2000s and filed for bankruptcy protection in November of 2009. By mid-2009, CIT had amassed roughly $65 billion in debt, and while the filing was expected and prepared for, it was still one of the biggest bankruptcies in American history. CIT emerged from bankruptcy after only 38 days, making it the only major financial sector company at the time to do so.

WorldCom was a telecommunications company who filed for chapter 11 bankruptcy in July 2002. At the time, this was the largest bankruptcy in American history, and with it came with many changes to the company. WorldCom paid $750 million to the U.S. Securities and Exchange Commission; a new CEO was hired; the company moved from Mississippi to Virginia; and it changed its name to MCI Inc. MCI emerged from bankruptcy in 2004, although many of its creditors were left unpaid. Some of these creditors included laid-off employees who never received severance or benefits. WorldCom’s co-founder and CEO, Bernard Ebbers, was later convicted of fraud and conspiracy and sentenced to 25 years in prison.

The Enron affair is one of the most well-known financial scandals in American history, and the name “Enron” has since become synonymous with corporate fraud and corruption. Enron was founded in 1985 and quickly became one of the most prosperous suppliers of electricity and natural gas; in 2000, Enron saw over $100 billion in revenue. Or . . . did they? In 2001, Enron was revealed to perpetrating massive amounts of accounting fraud. The company quickly entered bankruptcy, some people went to jail, employees lost billions in pensions, and the ordeal caused massive shockwaves throughout the business world.

General Motors is one of the most iconic car companies of all time. In 2016, over ten million GM vehicles were sold around the globe. However, like most companies at the time (including rival car manufacturer Chrysler), GM suffered heavily in the great recession and went bankrupt in June 2009. They emerged from this financial purgatory roughly one month later, with significant help from the government through its Troubled Asset Relief Program. As a result of the bankruptcy, GM discontinued various brands, including Saturn and Pontiac brands.

Washington Mutual was once a holding company who owned the largest thrift institution in the United States. By 2007, Washington Mutual employed over 40,000 people, had over $188 billion in deposits, and had assets valued at over $327 billion. And, like other companies, including CNO Financial and MF Global, it all went kaput. In September 2008, the FDIC took control of Washington Mutual after $16 billion was withdrawn from the bank. The very next day, Washington Mutual Inc. filed for bankruptcy. By 2009, WaMu branches became Chase branches, bondholders lost $30 billion, and Washington Mutual had a reputation as the largest failed bank in American history. Before we unveil our top pick, here are a few honorable mentions. Pan American World Airways Nortel Sears Canada

The fall of Lehman Brothers is arguably the most notable and extreme example of bankruptcy in the history of the United States. Lehman Brothers was founded in 1850, and by 2008 it was America’s fourth-largest investment bank. However, Lehman Brothers became involved in the subprime mortgage crisis of the late 2000s, resulting in a host of financial liabilities that led to its declaration of bankruptcy in September 2008. At the time, the bank owned $639 billion in assets but were over $750 billion in debt. The bankruptcy was the largest in American history, and it significantly weakened the already-fragile financial markets at a vulnerable time.