By Mark Graham, 1 June 2001 17:30
NEWS PSINet filed for bankruptcy protection today in both the US and Canada. The beleaguered ISP filed for chapter 11 protection, along with 24 of its US subsidiaries, while four of its Canadian subsidiaries filed for bankruptcy under Canada's Companies Creditors Arrangement Act. In a statement CEO and president Harry G. Hobbs said this action has no affect on businesses operating in Europe, Asia, Latin America or the company's Metamor consulting business. He said that the existing capital structure within the company did not allow it to respond to the market downturn and he added this measure was a move to give it time to access strategy alternatives. By taking this action in North America, PSINet avoids the threat of creditors lawsuits as the court oversees its financial reorganization. With the announcement the ISP said the businesses involved still had approximately $300m in unrestricted cash, cash equivalents, short-term investments and marketable securities.
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