[email protected] Corp. has filed for Chapter 11 bankruptcy protection and will sell its broadband Internet access assets and related services to AT&T for $307 million, according to a company statement.
[email protected] claimed that bankruptcy protection would allow the company to maintain its high-speed Internet access 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,” said Patti Hart, chairman/CEO of [email protected], Redwood City, CA.
The news follows [email protected]'s announcement last week that it would close online advertising subsidiary MatchLogic by year-end, lay off 500 employees over the next three months and “refine” the portal services of its chief online property, Excite.com. Those developments were said to be part of a plan to reduce focus on narrowband media and increase focus on broadband access.
Previously, [email protected] on Sept. 13 announced it had sold online greeting card service BlueMountain.com to AmericanGreetings.com for $35 million in cash, after having bought the company in December 1999 for $780 million, $350 million of which was cash.
The sale of [email protected]'s broadband assets is subject to bankruptcy court approval.
[email protected] claims that it has enough cash to continue operating while the court reviews the proposed sale.
[email protected]'s broadband services reach 4.7 million homes nationwide.