KY ISP WinNet Files for Bankruptcy

Tags: IT services finance and investment WinNet

By Justin Lee, January 06, 2009
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(WEB HOST INDUSTRY REVIEW) -- WinNet Communications, parent company of Louisville, Kentucky Internet service provider WinNet (info.win.net), filed for bankruptcy protection last Thursday.

With the economic downturn worsening by the day, the filing marks one of the first financial crises among large service providers of the new year.

WinNet Internet president and chairman Michael Tague cited the economic recession and debt from recent acquisitions as key factors in the bankruptcy filing.

Tague said the service provider's 14 employees would not be affected by the Chapter 11 filing, which he hopes will enable the company to regain its footing and help buy it some time with creditors.

Tague estimates the transitional period will take about four to six months.

Founded in San Francisco in 1990, Win.Net provides Internet service to about 2,500 customers in Louisville, Central Kentucky and Southern Indiana.

The company also provides web hosting services to several thousand websites, as well as consulting services.

WinNet made a series of acquisitions beginning in 2000, scooping up a few small Internet service providers.

These buys resulted in increasing the company's debt, said Tague, making it exceedingly difficult for the company to add new services.

Filed in US Bankruptcy Court for the Western District of Kentucky, WinNet's case shows estimated assets of less than $50,000 and debts of between $500,000 and $1 million.

The company has between 100 and 199 creditors, including L&N Federal Credit Union, which is owed $41,420.81, and AT&T, which is owed $225,000.

The records also indicate that the company owes $127,153 to prospect resident Donna Warren, who Tague told the Courier-Journal.com is his sister, and that he verified her loan to WinNet.