Advertising technology company Engage on Tuesday announced that it is insolvent, that it plans to file for Chapter 11 bankruptcy protection and that it is negotiating the sale of all its assets to a third party.
Before a deal can be reached, it must get approval from secured lender and former majority owner CMGI. Andover, Mass.-based Engage said if it cannot get CMGI approval in time, or if negotiations fall through, that it will liquidate its assets and "wind up its affairs."
The announcement ends Engage's attempt to salvage its business after a series of strategic changes. The fortunes of the once high-flying company were closely tied to CMGI during the dot-com boom. But the bursting of the Internet bubble in 2000 and the collapse of advertising sent Engage into a downward spiral.
Engage once competed with DoubleClick as a Web advertising network but exited the business in November 2002 when it sold its online advertising division to its employees. The company then banked its future on becoming a provider of advertising, marketing and promotional solutions, helping companies manage their digital assets.
Engage was one of the prime assets in CMGI's portfolio of majority-owned Internet companies, along with search engine technology company AltaVista. AltaVista has since been acquired by Overture Services, and CMGI's business remains on shaky ground.
CMGI severed financial ties with Engage in September 2002. CMGI's stock once traded as high at $160 a share; its shares now trade below $2.