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Wednesday, 22 August, 2001, 15:38 GMT 16:38 UK
Excite UK holds on
Excite logo
Excite@Home's UK arm has insisted the portal's financial future is secure for the next 12 months.

Its American parent company admitted on Tuesday that it was running out of cash.

But that is not true of Excite UK, according to managing director Rebecca Miskin.

"There aren't any scenarios where we're going to run out of cash or have to make any drastic changes," she said.

The UK-based portal is a joint venture between Excite@Home and British Telecom.

Parent problems

Ms Miskin's reassurance to investors comes after the US company said its existing cash and other liquid assets might not be enough to fund operations through the end of 2001.

The once high-flying global portal and high-speed internet service provider ran up losses of $833m in the first three months of the year.

Its high-speed cable modem internet access service boasts 3.2 million subscribers.

Its auditor Ernst & Young says there is "substantial doubt" about the AT&T subsidiary's ability to continue as a going concern.

However, Alan Alper, internet analyst at Gomez Advisors, in Concorde Massachussetts told the BBC's World Business Report that he thought it would survive.

"I don't think AT&T will let this thing die. It is too important for AT&T is just too vital.

"I think something is going to shake loose, this company will not die. Its name may change, but its assets are too valuable."

Nasdaq ejection fears

The company is also struggling to fight a delisting from the US Nasdaq technology index because of the dramatic decline in the value of its shares.

In morning trading on Wednesday, shares in Excite stood at 48 cents.

This is a far cry from the high of $18.56 in September last year before the worst of the tech stock crash had been felt.

The Nasdaq rejects companies whose share price falls below $1.

Excite@Home has been frantically trying to raise cash, announcing the closure of its divisions in France, Germany and Spain last month.

And on Friday, the firm announced a third round of redundancies in the US.

Analysts say that a delisting from the Nasdaq would almost certainly push the troubled firm into bankruptcy.

See also:

21 Aug 01 | Business
Investors desert Excite@Home
23 May 01 | Business
T-Online eyes ExciteAtHome
06 Jun 01 | Business
Excite@Home retreats in Europe
08 Jan 01 | Business
GUS gives Breathe new life
17 Dec 00 | Business
Breathe loses battle for life
03 Jul 01 | Business
Thousands of surfers 'to be cut off'
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