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By Sonya Rabbitte, 2 October 2001 14:20

NEWS Internet incubator group Antfactory has denied reports that it is returning $120m to investors after shareholders complained that the company had failed to deliver on investments. According to a report in Saturday's Telegraph, the company's largest investor - US venture capital firm Whitney & Co - led a shareholder revolt demanding that Antfactory return $120m. The report said that Antfactory angered investors this year when it only managed to raise $9m in new ventures despite having access to an investment fund of $350m. But Bob Gogel, vice chairman of Antfactory, told silicon.com that the report was not true and that Antfactory was considering legal action against the Telegraph. "We are not returning $120m, there is no dispute with shareholders. This is misinformation and I don't know where it came from," he said. He also denied comments attributed to him on technology newswire Tornado-Insider.com, which quoted him as saying: "One or two of our shareholders are experiencing serious financial problems themselves. Therefore we have to give back $120m which we are in the position to provide in cash." Gogel insisted business would continue as normal at Antfactory. Investors in Antfactory include US VC firm CVC Capital Partners, UK venture capitalist Allianz Partners, German VC Marco Polo along with Spanish and Swedish investors.