Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
Value America Inc. has filed for Chapter 11 bankruptcy and will discontinue its online computer and electronics retailing operations to concentrate on the development of its electronic services business for third-party manufacturers, vendors and distributors to enable them to fulfill online orders from consumers, arrange for payment and deliver goods and products.
"The prospect for near-term profitability of a company engaged exclusively in the retail side of the electronic commerce industry is not assured," says Glenda Dorchak, chairman and chief executive officer of Charlottesville, Va.-based Value America. "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."
Potential investors and acquirers already have expressed interest in the electronic services business proposition, Dorchak says. "We are hopeful that this filing will give Value America the breathing room it needs to further enhance the value of our technology and infrastructure assets and further explore opportunities for our electronic services business."
As part of the shutdown, the company terminated 185 employees involved in its retailing operations, it says.