PSINet Delays Annual Report, May Seek Bankruptcy - Brief Article

ISP Business, April, 2001

Internet service provider, PSINet Inc., said it would delay filing its annual financial report, saying it expects to take restructuring charges for the fourth quarter of 2000 that may be "significant," and that it may eventually file for bankruptcy.

The company said efforts to consider financial and strategic alternatives "are likely to involve the company's reorganization under the federal bankruptcy code."

The firm said that even if a restructuring under bankruptcy protection were successful, the company's common stock "will have no value," and its debt would be worth "significantly less than face value."

The firm, which has set previous restructuring earlier in 2000 and said in March that it would need to rearrange its debt, cited "rapidly changing circumstances impacting the company" for the request to delay the annual 10-K form.

PSINet said it has engaged outside consultants to evaluate certain "potentially impaired assets" to enable the firm to finalize its financial statements, which it expected to file by April 18, 2001.