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MotherNature.com can't weather the storm
By Greg Sandoval
Staff Writer, CNET News.com
November 7, 2000, 5:05 PM PT
update Health site MotherNature.com announced Tuesday that it is shutting
down, making it the second CMGI-backed company to fold in as many days.
In a news release, the online retailer of vitamins and other health products said its board of directors set a shareholders meeting for Nov. 30 to approve its liquidation plans.
MotherNature said the liquidation would provide shareholders with $13.4 million, or 85 cents per share, "before the end of the year." Another 15 cents per share "will be held in a contingency reserve...that stockholders could receive over the next three years."
After trading as high as $14.56 in the past year, shares of MotherNature
closed Tuesday at 62 cents, giving the company a market capitalization of
Just last month, an Internet holding company called Sitestar said that it tried to buy Concord, Mass.-based MotherNature, but that it was rebuffed. Encino, Calif.-based Sitestar said it offered $11.4 million for MotherNature.
CMGI spokeswoman Krista Thomas said that with the down market choking off new funding for most dot-com companies, all of the large venture capital concerns are feeling the heat.
However, Thomas said the closure was not related to the announcement Monday that another CMGI-backed company, Furniture.com, was shutting down because of difficulties in finding new funding.
"We agreed in both cases with the decision made by their boards," Thomas said. "In MotherNature's case, that liquidation is in the best interest of the company's shareholders. In the case of Furniture.com, closing the business is the best course of action to protect the customers, employees and saleable assets."
According to the MotherNature's S-1 filing, it had 190 employees as of September. Company executives did not return calls Tuesday to confirm whether those employees were laid off immediately.
MotherNature is only the latest Internet company to join the dot-com deathwatch. Also Tuesday, Pets.com announced it was shutting down and laying off 255 employees. On Monday, Furniture.com announced it was shutting down, and earlier this month, male lifestyle site TheMan.com closed its site. In recent weeks, Beautyjungle.com, Eve.com and BigWords.com have either closed their doors or laid off staff.
For the nine months ended Sept. 30, net sales at MotherNature totaled $10.5 million, up from $2.6 million. Net loss fell 5 percent to $32.1 million.