Nearly three years after emerging from Chapter 11 bankruptcy, Silicon Graphics (SGI) has entered protection for the second time.

If the first bankruptcy was embarrassing, the second looks as if it could be a terminal humiliation for the company that achieved cultural fame as one of the two platforms used to create famous computer-created films such as Pixar's first Toy Story, in 1995.

Rackable System has now said that it plans to buy the assets of the company for a trifling sum of $25 million (£18.8 million) in cash, and will also assume some of SGI's liabilities. The price is roughly a 15 percent premium to the company's shrunken share price.

The asset sale, which is subject to approval by the bankruptcy court, is expected to close within 60 days. SGI, which had posted a net loss of $49.2 million in the second quarter, will continue operating until the deal closes.

Founded as long ago as 1981 by entrepreneur-engineer and sailing obsessive Jim Clark, who later co-founded browser and pioneer Netscape, SGI is believed to have $526 million in debts.

The company, which is said to have 1,200 workers, was given a de-listing notice by the NASDAQ technology exchange in recent weeks.

Rackable has made no official comment on the deal, but is due to talk to the press an analysts during a press call later today.

- Additional reporting by Chris Kanaracus, IDG News Service