Net Imperative joins Boo on web scrap heap
The collapse yesterday of dot.com information provider Net Imperative within aweek of Boo.com's failure is the 'thin edge of the wedge', according to a partner at liquidators Kroll Buchler Phillips.
The East London-based internet news service was forced to bring inliquidators Kroll after investor Durlacher refused to raise further funds fromshareholders to keep the six-month-old company afloat.
Lee Manning explained: ‘We are going to see quite a few dot.com collapses andwhat has happened this week at Boo.com and Net Imperative is only the thin edgeof the wedge.’
Kroll has also been approached by another failing e-commerce business with£750,000 worth of investment that Manning believes are ‘likely to go down at anymoment’.
He added: ‘Nothing has changed in terms of what these dot.com companies aredoing, it’s down to a loss of confidence by investors.’
Staff writers at Net Imperative ironically posted their last story yesterdaymorning outlining the decision by liquidator Mick McLoughlin at KPMG to issueredundancy notices to 220 out of 250 staff at Boo.com, the internet sportswearretailer that collapsed at the end of last week.
The 37 staff have decided to still turn up for work, but have been told there isno money for pay.
A creditors meeting has been called for June 14.
The six month old new media information and news provider went live in Februaryand has been valued as high as £15m.
Manning said: ‘The management quite simply ran out of money because shareholdersput in any more funds.’
Manning added that rescue options for Net Imperative would require finding aninvestor prepared to make ‘a substantial capital investment of £0.5m or more totake the business forward’.
He added that Kroll had already been approached by a number of interestedparties.
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‘We really want to find a recovery option for the business, rather than see thestaff lose their jobs’, he added.
Geoffrey Chamberlain, chairman and chief executive of Durlacher, said thecollapse was the company’s first internet failure, but argued it ‘was not aBoo.com situation’ as the company was only capitalised at £2m.
Chamberlain said: ‘It is sad for everyone when this happens, but we set stricttargets, and if they are not achieved then we must accept it.’
Durlacher shares have fallen more than 80% since February and fell 8p to 69.5pas news broke.
http://www.netimperative.co.uk