Divine has signed a letter of intent with EBSCO Industries, global leader for the delivery of integrated information systems and services, for the sale of RoweCom, providers of e-commerce solutions for purchasing and managing the acquisition of magazines, newspapers, journals and e-journals, books and other sources of comprehensive knowledge resources
Rowecom had been acquired by divine in November 2001,
The proposed transaction, contingent upon regulatory approval in France and customary closing conditions, has been endorsed by the steering committee of the ad hoc committee of publishers and RoweCom customers.
"We believe that the sale of RoweCom to EBSCO is the optimal solution for
its customers and the various publishers that provide content to customers,"
says divine Chairman and Chief Executive Officer Andrew "Flip" Filipowski.
"We are grateful to our customers and the publishers who continue to work
with us to achieve a resolution that we believe is in everyone's best interests and appreciate the patience of customers and publishers as the negotiation process has moved forward."
To facilitate the sale of RoweCom's assets and operations to EBSCO, and to
ensure that RoweCom's operations continue without interruption until the
transaction is finalized, RoweCom expects to file a voluntary petition for
reorganization under Chapter 11 of the U.S. Bankruptcy Code.
In December, divine announced that RoweCom would most likely be unable to
obtain the necessary financing that it expected to receive in order to pay publishers the subscription fees for customer orders for 2003 periodicals,
as the company has done in the past.
Once it became clear that RoweCom might not be able to meet obligations owed to publishers, it stopped taking orders from customers and stopped accepting pre-payments for 2003 subscription fees.
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