Webvan Says It Needs More Cash to Stay in Business
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Online grocer Webvan Group Inc. could be nearing the end of the aisle.
In its annual report filed this week with the Securities and Exchange Commission, Webvan said it needed a substantial infusion of capital to stay in business beyond the fourth quarter. In a note attached to the company’s 2000 financial results, auditors Deloitte & Touche said there is “substantial doubt about Webvan’s ability to continue as a going concern.”
Foster City, Calif.-based Webvan takes online orders for groceries, CDs, books and other household items and delivers them in Los Angeles, Orange County, Sacramento, San Diego, the San Francisco Bay Area, Atlanta, Chicago, Seattle and Portland, Ore.
Webvan, which has former Netscape Chief Executive James Barksdale and Yahoo Inc. Chairman Tim Koogle on its board of directors, notes that the Internet has not taken off as a medium for grocery shopping, with too few customers placing repeat orders.
Net losses rose from $144.6 million in 1999 to $453.3 million in 2000, when Webvan merged with HomeGrocer Inc. Webvan’s stock, which debuted at $26 in its initial public offering in November 1999, closed unchanged at 13 cents Tuesday on Nasdaq.
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