Webvan to Sell Remaining Assets
Online grocer Webvan Group Inc., the once promising technology firm that said it would revolutionize the convenience store industry, said yesterday it is soliciting bids for its remaining business units, technology platforms and other assets.
Still, officials at the once-promising dot-com business, which declared bankruptcy last month after a much-heralded, but brief stay in the convenience delivery business, does not expect to raise enough money to pay its shareholders. The company expects to raise enough money to pay its unsecured creditors, but declined to say what that amount is.
On July 13, Webvan, which raised a breathtaking $1 billion to build a grocery delivery company in the early days of the Internet frenzy, filed for Chapter 11 under U.S. Bankruptcy law, saying it would cease operations and terminate 2,000 employees, the Associated Press.
Webvan had assets with a book value of $1.2 billion and debts of $106 million, according to papers filed in the U.S. Bankruptcy Court in Delaware, where the company is incorporated.
Among its unsecured creditors is former Chief Executive George Shaheen, with whom the company said in May it would honor its agreement to pay him $375,000 a year for life. He resigned in April, after Webvan said that although its first-quarter sales more than doubled to $77.2 million, its net loss ballooned to $217 million.
The company said it has contacted more than 60 potential buyers and expects several interested parties to submit offers by an Aug. 27 deadline.
The centerpiece of the assets offered for sale is Webvan's electronic commerce platform for warehouse management. Last week, the company said it auctioned off the furniture, office equipment and material-handling systems from its Atlanta facilities in a first round of bankruptcy sales.
Still, officials at the once-promising dot-com business, which declared bankruptcy last month after a much-heralded, but brief stay in the convenience delivery business, does not expect to raise enough money to pay its shareholders. The company expects to raise enough money to pay its unsecured creditors, but declined to say what that amount is.
On July 13, Webvan, which raised a breathtaking $1 billion to build a grocery delivery company in the early days of the Internet frenzy, filed for Chapter 11 under U.S. Bankruptcy law, saying it would cease operations and terminate 2,000 employees, the Associated Press.
Webvan had assets with a book value of $1.2 billion and debts of $106 million, according to papers filed in the U.S. Bankruptcy Court in Delaware, where the company is incorporated.
Among its unsecured creditors is former Chief Executive George Shaheen, with whom the company said in May it would honor its agreement to pay him $375,000 a year for life. He resigned in April, after Webvan said that although its first-quarter sales more than doubled to $77.2 million, its net loss ballooned to $217 million.
The company said it has contacted more than 60 potential buyers and expects several interested parties to submit offers by an Aug. 27 deadline.
The centerpiece of the assets offered for sale is Webvan's electronic commerce platform for warehouse management. Last week, the company said it auctioned off the furniture, office equipment and material-handling systems from its Atlanta facilities in a first round of bankruptcy sales.