Denver-based broadband provider Aerie has indicated it intends to restore some portions of the Ricochet network, perhaps in its home state of Colorado and California.
The deal, approved in U.S. Bankruptcy Court on Friday, is expected to be finalized by the end of next week. Under the deal, Aerie receives Metricom's assets, except for about $134 million the company has in the bank, which is dedicated to creditors.
"They were the highest and best price bid we received," said Metricom attorney Margaret Sheneman.
Aerie executives declined to comment.
In the two months since Metricom filed for bankruptcy, at least five buyers surfaced. But only two bids aside from Aerie's were actually submitted. Both were withdrawn Thursday, Sheneman said.
Although it had only 51,000 subscribers in 14 states, Metricom is considered a Silicon Valley pioneer for creating a network that allows people to surf the Web from a park, the train or a car. Metricom investors, including WorldCom and Microsoft co-founder Paul Allen, poured as much as $500 million into the company.
The technology had its problems, including installation difficulties and slow connections. In addition, the high cost of building the network made it difficult to earn a profit. The company filed for Chapter 11 bankruptcy protection in July.
On Thursday, shareholders filed a class-action lawsuit in U.S. District Court in San Francisco.
Metricom was founded in 1985 and has built a small but loyal following, with many raving about the technology.
Analysts say the service, which costs about $75 per month, was a technological marvel but too expensive to attract anyone other than early adopters and a smattering of businesspeople.
The company filed for bankruptcy protection after failing to secure enough subscribers or cash to keep it going through the summer. In court records, it outlined how it has left a debt trail of nearly $1 billion.
WorldCom, Metricom's largest creditor, claims it is owed $355 million, according to court records. WorldCom owns an estimated 50 percent of Metricom's preferred stock. Metricom also owes more than $300 million to "many" bondholders who bought Metricom issued bonds, according to Paul Silverstein, an attorney representing the bondholders.
Some analysts have said Metricom's downfall is only the beginning of consolidation among wireless Internet service providers. Bryan Prohm, a wireless industry analyst for Gartner, a market research and consulting firm, has previously described it as "the only logical Darwinian outcome."
Earlier this month MobileStar, a wireless Internet service provider for dozens of hotels and hundreds of Starbucks, laid off most of its staff and shuttered its network.