Excite@Home Corp. said Friday that it agreed to sell essentially all of
its broadband Internet-access business assets and related services to AT&T
Corp. for $307 million in cash.
Excite@Home, as expected, filed for relief under Chapter 11 of the U.S.
Bankruptcy Code the same day. The asset sale is subject to the emergence of
higher offers and closing conditions, including bankruptcy-court approval.
The company said the filing will let it maintain operation of its high-speed
cable Internet-access services and other related services during the
In a related development, the NASDAQ exchange halted trading of Excite@Home
shares Monday morning, seeking 'additional information.' The stock had slumped
to 15 cents per share in early morning trading.
'This filing is a tool to protect the value of the broadband business for the
benefit of the company's financial stakeholders, and it will help to reassure
our customers that service will continue uninterrupted through the restructuring
process,'' chairman and CEO Patti Hart said in a news release. 'AT&T's offer
reflects the value in our network, services, customer base and skilled
Excite@Home said it has enough cash on hand to finance its operations --
including supporting the company's post-petition trade and employee obligations,
as well as its ongoing operating needs -- while the court works through the
The company retained investment-banking firm Houlihan Lokey Howard &
Zukin to assist it in pursuing strategic alternatives and continuing with the
AT&T confirmed the agreement Friday. The telecommunications giant -- its
cable MSO, AT&T Broadband, uses Excite@Home to provide high-speed-data
service -- said it 'remains committed to working with Excite@Home's management
and the bankruptcy court to provide uninterrupted high-speed cable Internet
service to existing Excite@Home customers, as well as continuing relationships
with other cable companies to ensure seamless service to their customers on the
Cox Communications Inc., a 6.2 million-subscriber MSO that provides its
Cox@Home high-speed-data service with Excite@Home, said in a prepared statement
that it was confident that there would be no interruptions to its service.
'We welcome the operating strength of AT&T,' Cox senior vice president of
strategy and development Dallas Clement said. 'Our customers are our top
priority, and we are confident that together, Cox, Excite@Home and AT&T will
ensure the high-quality uninterrupted high-speed Internet service our Cox@Home
subscribers expect and enjoy.'
AT&T also said that if the asset purchase goes through, 'it plans to
build on the assets it acquires to develop a more robust network while improving
and growing its broadband high-speed Internet-access business for all
The companies hope to close the transaction by early next year.
AT&T said debtor-in-possession financing was
unnecessary, as Excite@Home believes it has sufficient funds to continue
operations throughout the period prior to closing.