US-based eProcurement software vendor Metiom (formerly Intelisys electronic commerce) has filed for Chapter 11 bankruptcy protection after running out of cash, leaving some uncertainty over the future of its large investment in its Australian subsidiary.
Metiom Australasia is a joint venture between the aforementioned US parent, who provided technology, and Westpac Banking Corporation, which funded the company through a $45 million investment in June 2000.
Filing for Chapter 11 protection from bankruptcy allows the US parent to prevent creditors from gaining access to its assets while it reassesses its financial options.
According to Metiom Australasia chief executive officer David Issa, the US parent and Australian company are two very separate entities. "We are still operational," he told ARN. "There is no impact on us at all."
Issa said the company is financially independent, and has recently managed to become technically independent from the US company. He said the company is achieving its business plan, and has spoken to its customers to comfort them about concerns the problems in the US company may filter through to its Australian investment. Metiom Asia Pacific customers include its 49 per cent stakeholder Westpac Banking Corporation, the South Australian Government and BHP Steel subsidiary New Zealand Steel.
US reports suggest Metiom's staff have been reduced from 350 staff down to fewer than 50. Metiom Australasia originally planned to scale its staff numbers up to around 60, but considering the current economic conditions the company only hired 40 staff. Issa said he will actually be hiring additional developers in the near future.
US reports also suggest the company's major creditor is US accounting software vendor Intuit.