August proves the cruellest month for broadband pioneer...
An investment group which took part in a $100m funding exercise for Excite@Home is demanding half the money back, claiming Excite misrepresented its financial position.
The demand for $50m caps a disastrous month for the broadband and internet content company. Last week - as the company was facing up to the possibility of bankruptcy - shares plunged 46 per cent and credit ratings agency Standard & Poor's downgraded Excite to a triple -C rating.
According to a source inside the Promethean Investment Group, Excite's management had assured investors back in April it would need $75m-$85m to continue operations for the rest of the year.
The source - quoted in the FT - said that the situation changed dramatically in late July when Excite said it might need more money meet its targets.