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WhyRunOut acquires Net grocer PDQuick

The Web delivery company has bought PDQuick, an online grocer that planned to expand nationally but instead has been struggling because of a brutal shakeout in the industry.

Web delivery company has acquired PDQuick, an online grocer that planned to expand nationally but instead has been struggling to survive because of a brutal shakeout in the industry.

Gartner analysts Kevin Murphy and Geri Spieler say the recent buyout of Net grocer PDQuick by is another step toward the ultimate destination of the online home-delivery market--franchising.

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Dan Frederickson, CEO of privately held PDQuick, told CNET on Wednesday that PDQuick's preferred shareholders sold to WhyRunOut.

Frederickson said employees at PDQuick's Camarillo, Calif., headquarters were locked out of the facilities after the deal was sealed Tuesday. They were told Wednesday that they could interview for their old jobs with the company, he said.

In June 2000, PDQuick received $20 million in funding from backers that included GE Capital Group. At the time it expected to operate in 30 cities, and it eventually made deliveries in Maryland and San Diego.

PDQuick began winding down operations in the past two months, closing some of the 16 brick-and-mortar stores it operates in the Los Angeles area. Executives informed employees last month that the company would be forced to close altogether unless it could find a buyer or new investors, sources said.

Many Net home-delivery companies have recently scaled back operations or closed, as the costs of delivering food and other goods was too high and demand too low. Net delivery companies such as ShopLink, and have shuttered operations.

As reported in March, PDQuick had been negotiating with now-defunct online retailer for a possible merger.

Those talks broke down, sources said, when investors pulled out of the deal, sources close to the deal said. Former Net highflier Kozmo was forced to close its doors weeks later.

WhyRunOut is a Web-based delivery service that operates in Southern California. On its Web site, the Aliso Viejo, Calif.-based company displays products and services from local retailers and allows customers to order them online. It then transports the goods to customers' doors.

Representatives of WhyRunOut were not available for comment.