August 30, 2001, 12:00 AM

Buy gets bought; Egghead gets Fry-ed

Buy.com Inc. and Egghead.com Inc., two teetering pure-play online retailers, both found buyers last month.

Internet Retailer

The best that can be said is that they’re not going out of business. Buy.com Inc. and Egghead.com Inc., two teetering pure-play online retailers, both found buyers last month.

Scott A. Blum, who founded buy.com but resigned in 1999 before the company went public, is buying back his creation. Blum’s SB Acquisition Inc. will provide $9 million in interim financing to keep buy.com in business, then pay 17 cents a share for the company. Buy.com went public in February 2000, selling 16.1 million shares at $27 each.

Buy.com last month laid off 40% of its staff-50 employees. Second quarter revenues were $94.9 million vs. $193.2 million a year earlier. Net loss was $5.7 million, an 83% improvement over $33.6 million in Q2 2000.

Menlo Park, CA-based Egghead.com filed for Chapter 11 bankruptcy and agreed to sell to Fry’s Electronics, a San Jose, CA-based electronics retailer, which is expected to continue to operate the Egghead.com site. Egghead was an early proponent of online retailing, closing all its stores to sell only on the web. Egghead.com will continue to operate under Bankruptcy Court supervision pending close of the sale.

On the brink for some time, Egghead was forced into bankruptcy by what the company characterized as “a dramatic and unexpected decline in sales.” Said Jeff Sheahan, president and CEO: “That made it impossible to reach profitability in the fourth quarter.”

Comments

Sign In to Make a Comment

Comments are moderated by Internet Retailer and can be removed.

Not a member? Signup for free today!

Advertisement

Advertisement

Advertisement

Relevant Commentary

FPO

Seth Barnes / E-Commerce

Commissions are for closers

A Savings.com executive responds to an Internet Retailer article describing a web merchant’s decision to ...

FPO

Jason Squardo / Mobile Commerce

Five tips for achieving high mobile search rankings

Searches on mobile devices will soon exceed those on computers, Google says. Retailers that keep ...

Advertisement