INAP is filing for bankruptcy.
Again.
According to reports:
To effectuate a swift and efficient restructuring, INAP has voluntarily filed petitions under Chapter 11 of the US Bankruptcy Code in the US Bankruptcy Court for the District of Delaware.
According to INAP, there will be no disruption to clients. Strangely, they state that their “balance sheet is stronger than ever” and this is merely a “recapitalization process”.
Typicaly companies with strong balance sheets do not file bankruptcy. Excluding some exotic corner cases, the vast majority of bankruptcies are the result of a company being unable to service its debts or facing an apocalyptic legal liability of some sort. The latter doesn’t apply here, so…
According to Bloomberg (archive.ph):
The company has reached an agreement with lenders to repay $35 million of an existing term loan, swap the rest of the debt for stock and borrow a fresh $30 million to fund the business going forward, according to people familiar with the matter.
Stronger than ever? Really? Sounds to me like INAP can’t pay its debt, so it’s agreeing to pay a little, roll the rest, and surrender som equity. From the lender’s perspective, I’m not sure what value they put on equity in an enterprise filing bankruptcy for the second time, so I believe what’s actually happening is that INAP has to surrender control of its fate.
One of those “we can’t trust you with our money so we’re going to have a say in the boardroom” deals.
The current CEO, Michael Sicoli, joined to lead INAP through its previous bankruptcy in 2020.
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