Interliant Files Chapter 11; CEO, COO Resign


ASP-turned-managed-hosting-provider Interliant filed for Chapter 11 bankruptcy protection this week.

The company joins a growing list of ASPs and MSPs that have filed bankruptcy or exited the application and infrastructure hosting business.

USinternetworking also filed for bankruptcy protection in 2001 but emerged from it this year and merged with Interpath. Loudcloud, Intel and Qwest exited the hosting business earlier this year as well.

In a statement, Interliant said it believes it has enough cash collateral to maintain operations until Debtor-in-Possession financing is obtained.

Bruce Graham, president and CEO, resigned from the company but will remain a member of Interliant's board of directors. CFO Francis Alfano has taken on the role of CEO.

Other resignations include COO Steve Munroe and board members Thomas Dircks and Merril Halpern (Charterhouse Group International), and Charlie Feld (The Feld Group).

Graham said in February that he expected Interliant to grow in the 50 percent range following a decrease in its cash burn rate and a completed restructuring focused on the sale of its application hosting businesses.

Last year, Interliant began selling off what it considered to be noncore offerings such as its CRM and ERP practices. The company's most recent move was the sale of its PeopleSoft consulting group to Springbow Solutions in February.