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8 Horrifying Disasters That Bankrupted Huge Companies

The Poorest
8 Horrifying Disasters That Bankrupted Huge Companies

There’s currently a lot speculation about what will become of Malaysia Airlines. In March, Malaysia Airlines Flight MH370 went missing during it’s flight from Kuala Lumpur, Malaysia to Beijing, China. Crews are still looking for the wreckage, and are seemingly no closer to finding out what happened to the missing plane. In July, just a few months after MH370 went missing, Malaysia Airlines suffered another major and horrific disaster. Terrorists shot down Malaysia Airlines Flight 17 from Amsterdam, Netherlands to Kuala Lumpur, Malaysia over Ukraine. This quick succession of tragic events has lead Malaysia Airlines customers and investors to lose faith in the company, and financial troubles abound for the airline. It’s unclear whether either of these disasters could have been prevented, but most are certain that the aftermath of the events (especially Flight MH370) could have been handled in a better manner. Malaysia Airlines has been losing money for years, and these two catastrophes mean the airline’s future is particularly precarious.

Of course, huge catastrophes don’t necessarily have to end a company. British Petroleum is doing just fine financially just five years after the Deepwater Horizon oil spill; the company’s image is undeniably tarnished in regards to environmental responsibility, but BP’s bottom line is as good as ever. There was a call for Tokyo Electric Power Company (TEPCO) to be forced into bankruptcy following the Fukushima meltdown, but the company is still operating due to the Japanese government providing a bailout and becoming the majority shareholder of the company.

Some companies haven’t managed to weather such storms quite as successfully. These are eight companies that had to enter bankruptcy or bankruptcy protection following horrifying tragedies or wide-ranging disasters; some of these companies eventually recovered, but some faced irrevocable damage and dissolved.

8. Entergy New Orleans: Hurricane Katrina

EARNS ENTERGY

Entergy New Orleans, a subsidiary of Entergy Corporation, was forced to enter bankruptcy protection after the mounting costs of the aftermath of Hurricane Katrina. Lower revenue and storm restoration caused the company to falter.  Two years later, Entergy New Orleans came out of Chapter 11 and has since recovered well.

7. British And American Steam: Ship Disappearance

via wikipedia

via wikipedia

Over 170 years before MH370 went missing and over 60 years before the Wright brothers took flight, traveling by sea was the only option, and disappearances happened back then, too. In 1841, the SS President vanished at sea with 136 people on board.  It was the largest ship in the world at the time, and it was commissioned just one year earlier. Following the disappearance of the SS President, British and American Steam Navigation Company went under, figuratively speaking, and the company’s only other ship was sold to the Belgian government.

6. Freedom Industries: Elk River Chemical Spill

CORRECTION Chemical Spill West Virginia

After a chemical known as 4-methyl cyclohexane methanol leaked into Elk River, which caused the water supply in Charleston, West Virginia to be tainted, Freedom Industries had to enter bankruptcy protection with $10 million in debts. The company has faced numerous lawsuits since the Elk River Chemical Spill.

5. Mt. Gox: Fraud and Suspected Hacking

Japan Bitcoin

Many have speculated that bitcoin is the future of currency. However, digital currency comes with all the insecurity of digital data. Bitcoin exchange Mt. Gox was forced to file for minji saisei, a Japanese form of bankruptcy protection, earlier this year after $450 million worth of bitcoins went missing. It has been speculated the funds may have stolen through hacking.

4. Vanguard Airlines: 9/11 Terrorist Attacks

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Most airlines around the world suffered financially after the 9/11 terrorist attacks. The entire airline industry saw a huge economic downturn after the tragedy. However, some airlines handled the crisis better than others. 9/11 may have been the straw that broke the camel’s back for Vanguard Airlines. Despite $2-3 million in financial aid from the U.S. federal government, Vanguard was forced into bankruptcy, likely an indirect result of 9/11.

3. Trans World Airlines: Flight TWA 800 Explosion

Boeing_747-131,_Trans_World_Airlines_-_TWA_AN0746339

Things went from bad to worse for Trans World Airlines (TWA) in 1996. Just minutes after taking off from JFK airport, Flight TWA 800, a Boeing 747 which was en route to Paris, exploded and crashed into the Atlantic ocean. All 230 people on board were killed. TWA was already having major problems before this. It was a target for Palestinian guerrilla groups from the 60s to 80s; five TWA airliners were hijacked and bombed during this time. TWA went into bankruptcy twice in the 90s and was forced to go into bankruptcy yet again as part of an agreement to be purchased by American Airlines in 2001.

2. USEC: Fukushima Disaster

Dominion Nuclear Weapons

Unlike TEPCO, The United States Enrichment Corporation (USEC) can’t count on the Japanese government to keep it from experiencing extreme financial hardship. USEC was one of the biggest suppliers of uranium to TEPCO before the Fukushima meltdown, which was caused by the 2011 Tohoku Earthquake and Tsunami. After the Fukushima disaster, many nuclear plants around the world shut down due to safety concerns. As a result, uranium prices plummeted by more than 30% from their price before the Fukushima disaster. The lack of demand for uranium and the low prices caused USEC’s bottom line to suffer greatly and the company was compelled to seek bankruptcy protection.

1. Montreal, Maine and Atlantic Railway: Train Derailment & Explosion

Canada-Oil Train Disaster

The worst railway disaster in Canada since the 1800s happened when a 74-car train hauling crude oil derailed in Lac-Megantic, Quebec. The resulting explosion killed 47 people and caused horrific destruction. The accident totalled $200 million worth of damage and Montreal, Maine and Atlantic Railway had to enter bankruptcy just one month later. Earlier this year, the defunct company’s assets were sold at auction to Railroad Acquisition Holdings, LLC.

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