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Technology Stocks : StorageNetworks, Inc. (STOR) -- Ignore unavailable to you. Want to Upgrade?

To: Crossy who wrote (179)	3/6/2003 2:27:33 PM
From: Glenn Petersen	Read Replies (1) \| Respond to of 187

StorageNetworks hires investment bankers Waltham firm looks at options By Ross Kerber, Globe Staff, 3/6/2003 boston.com StorageNetworks Inc., the once high-flying data-storage company based in Waltham, yesterday said it has hired investment bankers to study its strategic options, which could presage a sale or breakup of the company. In a prepared statement, the company said it ''has engaged the services of investment banking firms to identify and assess all available alternatives to maximize shareholder value.'' StorageNetworks also said two of its directors stepped down, but gave no explanation. Executives declined to comment further. StorageNetworks has failed to earn a profit as a software provider after its original plan to sell independent storage services failed. Its market capitalization of $91 million represents about half the value of the net cash of $186.4 million it had on Dec. 31, according to its securities filings. Most of the cash was generated from the company's initial public offering in 2000, at a time when StorageNetworks seemed poised to challenge the dominance of Hopkinton's data-storage market leader EMC Corp., where some of StorageNetworks' founders had once worked. StorageNetworks had initially aimed to lease out space on its own storage devices to reduce its customers' capital costs, but the business lost steam with the downturn in technology spending. It now competes with other storage software providers, including EMC and Veritas Software Corp. In January, StorageNetworks replaced its chief executive, Peter Bell, and announced plans to lay off 110 employees, or about half its work force. It was the latest in a series of cutbacks at the company, which employed 660 workers at its peak in 2001. ''We anticipate that our board of directors will be required to focus significant energy and time working with our investment bankers and other advisers to identify and assess opportunities to maximize shareholder value,'' Paul Flanagan, the company's new chief executive, said in yesterday's statement. The statement indicated that two directors, George McClelland and William Weyand, have resigned from the company's board. Neither returned messages. Shares in StorageNetworks rose 8 cents to close at 92 cents in trading after it released its news. The company's shares peaked at $142 in July 2000, just after its initial public offering. Ross Kerber can be reached at kerber@globe.com. This story ran on page E3 of the Boston Globe on 3/6/2003. © Copyright 2003 Globe Newspaper Company.