Excite@Home files for bankruptcy cover
Excite@Home, the embattled US internet service provider, has filed for relief under Chapter 11 of the US Bankruptcy Code.
The company made the announcement from its head office in San Francisco on Friday, and follows a month of reported financial problems, the resignation of its chief financial officer and the dismissal of its auditors Ernst & Young, replaced by PricewaterhouseCoopers.
The Chapter 11 filing will enable Excite@Home to maintain operation of its high-speed cable Internet access services and other related services during the sale approval process.
‘This filing is a tool to protect the value of the broadband business for the benefit of the company’s financial stakeholders and will help reassure our customers that service will continue uninterrupted through the restructuring process,’ chairman and chief executive Patti Hart said.
At the same time, Excite@Home announced the sale of its broadband internet access business assets and related services to telecom giant AT&T for $307m (Pounds 208.4m) in cash. The sale is subject to the emergence of higher offers and closing conditions, including bankruptcy court approval.
In a statement, the company assured investors that it had sufficient cash to finance all its ongoing operations and obligations to its employees, while the bankruptcy court reviews the proposed sale and other offers that may emerge.
Hart said AT&T’s offer reflected the value in the company’s network, services, customer base and skilled employees.
Links
Bankruptcy threat grows at Excite@Home