By Louise Banbury, 27 September 2001 09:20
NEWS Exodus, one of the biggest web-hosting firms in the business, has filed for Chapter 11 bankruptcy protection after falling prey to weakening demand and the weakening economy. In a statement, the company's chief executive William Krause said: "Exodus sacrificed profitability in exchange for growth and market share. We over-expanded in some areas in advance of demand, not anticipating the decline that resulted from the dot-com bubble burst and the economy weakening." However, he said that Exodus would continue uninterrupted daily operations of its internet data centres and offices and has received a commitment for up to $200m in debtor-in possession financing from GE Capital to allow it to carry on while it restructures. Speculation about Exodus' state of health has been building for some time and three board members resigned last month soon after the company posted an increase of over 100 per cent in second quarter losses. The company, which hosts equipment for websites like eBay and Yahoo, has debts of more than $3bn.
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