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Pets.com Calls It Quits

After months seeking funding, high-profile online pet retailer Pets.com threw in the towel Tuesday.

The San Francisco, Calif.-based company will lay off 225 of its 320 employees and plans to sell the majority of its assets, including inventory, distribution center equipment, URLs, content and its Sock Puppet brand icon as well as other intellectual property.

"I am deeply saddened by this event and regret that we will not be able to continue our commitment to our customers to provide the very best buying experience on the Internet," said Julie Wainwright, chairman and chief executive officer of Pets.com. "It is well known that this is a very, very difficult environment for business to consumer Internet companies. With no better offers and avenues effectively exhausted, we felt that the best option was an orderly wind down with the objective to try to return something back to the shareholders. We truly feel that we conducted a lengthy, thorough and thoughtful process to try to maximize shareholder value.

Pets.com , whose stock has slipped from a 52-week high of $14 to a Tuesday open of 68 cents, has been aggressively seeking capital since early summer. More recently, the company has been trying to find an outright buyer for itself, but Merrill Lynch, which was hired to assist the company in finding a buyer, could not put together a deal. Merrill Lynch contacted more than 50 international and domestic prospects, but fewer than eight were even willing to visit Pets.com, even though it was desperately attempting to reduce operating expenses and maximize efficiency.

Wainwright thanked Pets.com's customers and said those with outstanding orders should go to the Web-store for more information.

To Pets.com's employees, Wainwright said, "I want to thank you for your dedication. The entire team represents the best group of people I have ever worked with."