The sale of the software, which powered the company's warehouse, Web site and delivery operations, must be approved by the bankruptcy court overseeing the sale of Webvan's assets. The court plans to hold an auction to allow other potential buyers to outbid the $2.5 million offer made by Borders' company, Mercury Acquisitions.
Borders' bid is low considering how much Webvan, which filed for bankruptcy this summer, paid its programmers to create it.
When Foster City, Calif.-based Webvan was rolling in money, executives paid 100 software engineers more than $100,000 a year to power the Web supermarket's e-commerce technology, according to one former Webvan executive.
"We were practically running our own software company," the executive said. "The software they created was top-notch, but it cost the company a lot of money."
That's likely part of the reason Borders is bidding, said Allen Arthur, the former director of real estate for Webvan who is overseeing the liquidation of assets. Borders was among those who formed Webvan's business strategy, which led the company to spend almost $1 billion of investor money on automated warehouses, fleets of delivery vans, and developing software to manage its e-commerce operations.
"I think that Louis feels a certain sense of ownership," Arthur said. "Few understand what the technology can do better than he does."
Borders was not available for comment Friday.
Webvan was like many other Internet companies during the boom, spending lavishly on software programmers who wrote proprietary code for the company. But with the dot-com die-off, most companies have found it difficult to find buyers for their software and have wound up selling it at a fraction of its cost.
The failure of Webvan, which had a market value of $8.45 billion just after its initial public offering, was one of the biggest in e-commerce.
The overbid auction is scheduled for Oct. 1.