With WorldGate Communications Inc. running out of cash and warning investors
of a possible bankruptcy, the company hired Boston Corporate Finance Inc. to
"evaluate various strategic and financing alternatives" for the battered
interactive-TV provider.
The move suggested that there may be even more consolidation in the
interactive-TV business following Liberty Media Corp.'s moves last year to
snatch up OpenTV Corp. and Wink Communications Inc. on the cheap.
WorldGate -- which also hopes to sell 6 million shares of stock to investors
who like big risks -- disclosed in a Securities and Exchange Commission filing
that it only has enough cash to fund operations into the third quarter.
It also warned in the filing that if it can't score more financing, it may
have to suspend business and file for bankruptcy protection.
Founded in 1995 by former General Instrument Corp. executive Hal Krisbergh,
WorldGate rode the Internet bubble, with its stock hitting $50 at the end of
1999.
But its idea of selling cable subscribers Internet access and other
interactive services through the TV never caught on, and it has been hammered by
capital-expenditure cuts at MSOs.
Shares in WorldGate -- which was bumped down to the NASDAQ Small Cap index in
January -- closed Friday at 40 cents apiece.
