Two days after undertaking drastic cost-cutting measures, which included the
layoffs of 77 people, Egghead.com received a $20 million line from IBM
Global Financing.
To say the least, the Menlo Park, Calif.-based etailer is pleased to receive the
cash infusion. “Based on our cash position at the beginning of the year and
this new financing, we believe we will have sufficient funds to take us
through to profitability,” said John Labbett, executive vice president and
CFO.
“In addition, we are continuing to explore other financing options in
order to maintain a solid cash balance.”
The company has had its share of troubles of late. In February, revenue
expectations for the coming year were lowered to be on par with 2000.
Meanwhile, in December, a hacking attack had the potential to expose 3.7
million customer accounts.
The financial agreement adds to IBM’s portfolio, noted William Doscas,
vice president, market and sales operations, IBM Global Financing. “This
secured financing line agreement adds to our broad Commercial Financing
portfolio, which provides flexible financing for inventory, accounts
receivable and acquisitions,” he said.
At press time, Egghead.com was trading at 7/8, up by
7.69.