Defunct online grocer Webvan (Nasdaq: WBVN) said Monday that it is soliciting bids for the purchase of its business units, technology platforms and other assets.
In a blow to the company’s beleaguered shareholders, Webvan also said that it did not expect to have any funds available to distribute to them.
“Based on our preliminary analysis of the likely recoveries on our assets versus the expected claims against those assets, we do expect to have funds available for distribution to our unsecured creditors,” a Webvan spokesperson said. “We do not expect, however, to have any funds available for distribution to our equity holders.”
Foster City, California-based Webvan expects the “centerpiece” of its auction to be its technology platform. According to Webvan, the modular platform was “designed by some of Silicon Valley’s top software engineers” and is “extremely versatile — capable of a range of functions from a completely integrated e-commerce platform to supporting warehouse management and delivery operations.”
On the Table
Also on the auction block is the technology platform Webvan acquired when it purchased HomeGrocer.com last year for US$1.2 billion.
Interested parties have until August 27th to submit bids. Webvan said it has already contacted over 60 potential parties and anticipates several will submit offers by the deadline.
Webvan auctioned off the furniture, office equipment and material-handling systems from its Atlanta, Georgia facilities last week, and plans to sell off the assets from its Northern California and Baltimore, Maryland facilities in late September.
Although Webvan did not say what the proceeds from its Atlanta auction were, published reports indicated that the company auctioned off assets previously valued at $22 million for about $3 million. Among the assets auctioned were various pieces of office equipment and a 1999 Volkswagen Beetle that reportedly sold for $15,000.
Before filing for bankruptcy in July, Webvan tried numerous measures to stay afloat. In January 2001, Webvan curtailed its planned expansion into several East Coast cities and started closing operations in existing markets. Before exiting the online grocery business completely in July, Webvan departed the Dallas, Texas; Sacramento, California; and Atlanta markets.
Just days before finally pulling the plug, Webvan shareholders approved a 1-for-25 reverse stock split that would have kept the company’s shares trading on the Nasdaq stock exchange.
When Webvan filed for bankruptcy, its shares were trading at 6 cents each, down from an all-time high of $25.44. The shares had not traded above $1, the minimum requirement for a Nasdaq listing, since last November.
Since filing bankruptcy, Webvan has been hit with several shareholder suits claiming that the handling of the company’s initial public offering violated federal securities law.
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