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Value America Files Chapter 11 |
| Value America has
discontinued its e-retailing operations following an announcement on
August 11th that it has filed for Chapter 11 bankruptcy protection. The
company hopes to be able to continue in operation as a technology
services organization, helping companies to bring their businesses
online using the Value America technology.
Glenda Dorchak, Chairman and CEO said, "The decision to shut down our Internet retailing business was difficult. Despite tremendous efforts on the part of our employees and the loyalty of our vendors and customers, it has become apparent that the prospect for near term profitability of a company engaged exclusively in the retail side of the electronic commerce industry is not assured.'' As part of the shutdown today, the Company terminated 185 employees involved in its retailing operations. According to Dorchak, "The Chapter 11 filing will protect the interest of our many stakeholders and should ensure that our electronic services business has an opportunity to develop and move forward. After careful consideration, and despite our good faith efforts, we were unable to establish to our satisfaction that our Internet retailing operation would become profitable within a reasonable time frame. However, we believe the Company has one of the most sophisticated and commercially viable technology infrastructure backbones in e-commerce today. We also believe that it will prove valuable to other companies who want to launch an e-commerce solution of their own on the Internet.'' With the help of outside consultants, the Company said it has conducted extensive market research to understand how other companies, embarking on their own e-commerce solutions, could deploy Value America's experience, processes and technology. The Company also said it subjected its e-services business plan to due diligence reviews by potential commercial partners and received favorable feedback. The Company intends to continue with its e-services development efforts during the Chapter 11 proceeding. Unlike other dot.com companies that have recently filed for bankruptcy protection, Value America said it expected its electronic services business would emerge, on a stand-alone basis, from the reorganization filing and restructuring efforts. Voice Your Opinion!
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Updated: 17 Feb 2006 .
