The e-grocer Webvan Group, Inc. announced on September 20 that it has entered into a $2.5m contract for the sale of its technology platform to Mercury Acquisitions Corporation, a company controlled by Webvan's founder, Louis Borders.
Early August, Webvan began soliciting bids for its assets, including both the Webvan and HomeGrocer technology platforms.
Over 100 parties were contacted and more than 30 entities expressed interest in the platform.
After reviewing all proposed offers for the technology platforms, Webvan chose Mercury Acquisition Corporation's offer to purchase the Webvan and HomeGrocer technology platforms, as well as their respective trademarks, patents and other intellectual property.
According to Webvan, the Bankruptcy Court approved on September 20 the procedures by which the sale of the technology platforms to Mercury would be approved.
According to the Court's order, the agreement with Mercury Acquisition Corporation will be subject to an overbid auction to be held on October 1, 2001.
Others interested in purchasing the technology platforms are continuing their due diligence inspections and are anticipated to bid for the platform at the auction.
"We're very excited about our deal with Mercury and are hopeful that the process we began back in August will result in the highest value for our creditors," said a Webvan spokesperson.
"These technology platforms represent some of the best work by some of the best software designers.
In particular, the Webvan platform is modular in design and as such is extremely versatile, capable of a range of functions from a completely integrated e-commerce platform to supporting warehouse management and delivery operations.
The price currently offered is a fraction of what it would cost to develop a comparable platform and represents a unique opportunity in today's difficult business climate."
Scott McNutt, of McNutt & Litteneker, LLP, counsel for the Official Committee of Unsecured Creditors in the Webvan bankruptcy case, stated, "The Creditors' Committee is delighted that so many substantial companies have shown an interest in the acquisition of the technology platform.
Mr. Borders clearly sees substantial value here.
As a nationally known business figure whose previous accomplishments include the Borders Bookstore chain, his interest says a lot about the opportunity here.
Naturally, the process doesn't stop with this offer, when the Borders' deal is presented to the Bankruptcy Court, others can bid up the price.
This would make the Webvan Creditors' Committee very happy, as it will bring more money to the Webvan creditors."