LocalBusiness.com Shops Assets Online

Hoping to reconcile debts, Fort Lauderdale, Fla.- based LocalBusiness.com is
shopping its wares over its old Net stomping grounds.


In April, the network of local business news sites that reached 24 U.S.
markets, quietly closed its doors and 75 people lost their jobs. The fate of
digitalsouth magazine — its offline property based in Atlanta — was
unclear at the time.


Today, the company confirmed in a prepared statement that it had filed for
relief under Chapter 11 of the U.S. Bankruptcy Code in the Southern District
of Florida on May 2, 2001.


The Chapter 11 filing lists the company as having $2.56 million in total
assets and $1.54 million in liabilities.


The creditor list includes L90 Inc. of Los Angeles, Brobeck, Phleger &
Harrison of Austin, Texas, American Lawyer Media of New York, and Cox
Interactive Media of Atlanta.


What’s for sale?


In addition to selling small business tools and resources in each local
market, including Atlanta, Denver, New York City, and Seattle, assets of
LocalBusiness.com include a content archive of more than 48,000 original
news stories and company profiles, a VentureTracker database of more than
2,800 private equity-funded companies, and a national E-mail subscriber base
totaling more than 100,000 names.


The domain names LocalBusiness.com, digitalsouth.com (LocalBusiness.com’s
former title) and dbusiness.com are also on the selling block.


A spokesperson for the company said LocalBusiness.com was working on a bid package for interested parties.


“I would like to have definitive offers to take to the court within 30 days,” she said.


About 14 employees continue to staff the company Web site and digitalsouth, where the spokesperson said it was “business as usual.”


LocalBusiness.com, which competed with Advance Publications and Crain
Communications, among others for business readers, updated its sites with
breaking news and features focusing on start-ups and emerging companies.


The company also offered a community feel with message boards and other
investor tools.


But, as with many media companies, the offline flight of advertisers hurt
the ad-supported company that was founded by chairman Edwin Warfield in
1997.


In February, the company tried to right itself by appointing a new CEO, Jane
Seagrave. The company said Seagrave was tagged for her experience as
president of Legal Communications, Ltd., a Philadelphia-based publishing
company, that was acquired by American Lawyer Media in 1998.


Prior to Seagrave’s arrival, the company laid off about one-quarter of its
125 employees nationwide and shuttered several offices in December. To stay
buoyant, it also announced its intension to sell its TrueAdvantage B2B
division, which offered online services to small companies.


LocalBusiness.com’s institutional investors include U.S. Equity Partners,
L.P., Rustic Canyon Ventures and Tribune Ventures, the strategic investment
unit of Tribune Company.

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