NorthPoint Communications

From Wikipedia, the free encyclopedia
Jump to navigation Jump to search

NorthPoint Communications Group, Inc. was a competitive local exchange carrier focused on data transmission. It leased copper telephone lines from phone companies, then provided access to internet service providers to provide DSL service to businesses and residents.

The company existed and failed during the dot-com bubble.

History[edit]

The company was founded in 1997[citation needed] and went public on May 5, 1999 via an initial public offering in which it sold 15 million shares at $24 per share.[1] In September 2000, Verizon agreed to acquire a 55% interest in the company and merge the companies' DSL businesses.[2]

In November 2000, as its customers failed to pay their bills, NorthPoint restated downwards its financial performance for the third quarter of 2000, lowering revenue from $30 million to $24 million.[3][4] After the earnings restatement, Verizon terminated its acquisition agreement, claiming that a material adverse change had occurred.[4][5] Northpoint sued Verizon to force it to complete the transaction.[6] The lawsuit was settled out of court in July 2002, with Verizon agreeing to pay $175 million to Northpoint.[7]

On December 21, a shareholder[who?] sued NorthPoint for alleged waste of corporate assets, gross mismanagement and breach of contract.[citation needed]

Bankruptcy[edit]

In January 2001, NorthPoint filed bankruptcy.[8][9][10] Some internet service providers, which faced a disruption in service, blamed the banks for failing to work out a deal to save the company.[11] In March 2001, AT&T Corporation acquired the assets of NorthPoint for $135 million in a liquidation.[12][13]

References[edit]

  1. ^ "Schiffrin & Barroway, LLP Announces Class Action Suit Against NorthPoint Communications Group, Inc" (Press release). PR Newswire. November 2, 2001. 
  2. ^ "NorthPoint Receives $150 Million Investment from Verizon; Permanent Financing Part of Agreement to Merge Companies' DSL Businesses" (Press release). PR Newswire. September 6, 2000. 
  3. ^ Young, Shawn (November 21, 2000). "NorthPoint Restates Earnings; Loss Could Affect Verizon Deal". The Wall Street Journal. (subscription required)
  4. ^ a b SCHIESEL, SETH (November 30, 2000). "Verizon Abandons NorthPoint Deal". The New York Times. 
  5. ^ Bartash, Jeffry (November 29, 2000). "Verizon backs out of NorthPoint deal". Marketwatch. 
  6. ^ Lais, Sami (November 30, 2000). "Verizon, NorthPoint in heated dispute over DSL merger deal". Computerworld. 
  7. ^ "Verizon Agrees to Settle NorthPoint Merger Suits". Los Angeles Times. Bloomberg News. July 24, 2002. 
  8. ^ "NorthPoint files for Chapter 11". American City Business Journals. January 17, 2001. 
  9. ^ Young, Shawn (January 17, 2001). "NorthPoint Communications Files For Chapter 11 Creditor Protection". The Wall Street Journal. (subscription required)
  10. ^ Weiss, Todd R. (January 17, 2001). "NorthPoint files for Chapter 11 protection". Computerworld. 
  11. ^ Wagner, Jim (March 29, 2001). "ISPs React To NorthPoint's Imminent Shutdown". QuinStreet. 
  12. ^ Young, Shawn; Solomon, Deborah (March 23, 2001). "AT&T to Acquire Most Assets Of NorthPoint Communications". The Wall Street Journal. (subscription required)
  13. ^ Pultz, Jay E. (March 26, 2001). "AT&T Plans to Build Its DSL Market Position With Purchase of NorthPoint Assets". Gartner.