Liquidating Idealab

from the fight!-fight!-fight! dept

It's been a very long time since we've heard anything out of Idealab and Bill Gross. Remember that huge investment round they took prior to what was supposed to be their IPO? Well, it had these provisions (which we've discussed before) that more or less guaranteed the investors wouldn't lose money. Of course, that was when the company was worth $8 billion, and the investors were tossing in $1 billion. So, how do you guaranteed they don't lose anything when the company is now probably worth less than that $1 billion? It's a problem. Many of the investors are trying to force Idealab to liquidate and pay them off with whatever is left. Idealab has offered a deal to buy out the investors for ten cents on the dollar, but the investors feel he's lowballing them. Either way, it's not likely Idealab can raise any more money with this hanging over them (though, I wonder what sort of investors would even bother investing in Idealab even if this mess got cleared up).

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