Beleaguered payments processor CyberCash gets two bids
CyberCash Inc., provider of electronic payment technologies and services, has received two competing high bids of over $20 million, the result of the court sanctioned auction of CyberCash`s operating assets as part of CyberCash`s reorganization under Chapter 11. CyberCash did not reveal the winning bidders.
“The company is currently considering the bids and working out certain details in order to determine the most favorable bid,” a CyberCash statement said. The winning bid will be subject to approval by CyberCash Inc.`s Board of Directors and the bankruptcy court, both of which are expected by April 17, 2001.
Last year, CyberCash decided its focus was too narrow and to expand the business into broader payments processing. It agreed to merge with Network 1 Financial Corp., a credit card processor. But it was then unable to raise the additional funding to make the merger possible. “It was probably the worst time in history to be looking for funding,” says John Karnes, executive vice president and CFO. CyberCash called off the merger in March. “We decided to do the next best thing—an asset sale,” he says. CyberCash filed for Chapter 11 bankruptcy protection, then sought permission to hold an auction of assets.
Karnes says that CyberCash will remain a going concern after the sale. CyberCash Inc. provides services to more than 27,500 Internet merchants and has shipped more than 145,000 copies of its software products. CyberCash offers merchants risk management capabilities through its FraudPatrol Internet fraud detection service.
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