Interliant execs quit following bankruptcy filing
UK trading normally?
Managed hosting firm and ASP Interliant Inc has lost its CEO and president Bruce Graham and COO Steve Munroe after finally filing Chapter 11 bankruptcy protection.
Purchase, New Jersey-based Interliant, also lost directors Thomas Dircks and Merril Halpern and Charlie Feld from investors Charterhouse Group and The Feld Group, and said that CFO Frank Alfano will now take on the role of CEO and president of the company.
Last month, Interliant announced it would have insufficient funds to continue trading after the third quarter ending September 30. However, the company decided to call it quits early on August 5, and announced the Chapter 11 filing for its US operations. The company said it will continue to trade through debtor in possession financing while it restructures its operations in both the US and overseas. The UK business is not included in the bankruptcy.
During Interliant's last reported quarter, the three months ended March 30, the company trimmed its net loss to $11.6m from $81.2m in 2001, on revenue that slumped 45% to $19.2m. However, at the end of the period, total debts stood at $109.9m compared to $102.9m for the same period in 2001, on a cash position of just $5.77m.
Interliant's move follows a similar step taken by larger rival USinternetworking Inc, which filed voluntary bankruptcy proceedings in January 2002 as part of a rescue package involving $81.25m in cash from Bain Capital. USi was able to emerge from Chapter 11 in May, and merge with Interpath as a newly financed venture.
However, Interliant does not appear to have such a plan afoot, and the company could give no assurances on when it expects to emerge from bankruptcy or how it plans to generate new funding. Last week, enterprise ASP Corio Inc acquired rival Qwest CyberSolutions for just $15m in cash, and a similar takeover of Interliant now seems likely to be the company's only chance for survival in the near term.
The Register adds:
Interliant's UK operation is said to be trading normally. This means merely that it is not operating under bankruptcy protection. Word on the street is of sales staff lay-offs this week.