November 24, 2024
Business

Web provider Vitts ordered to close by May 9

MANCHESTER, N.H. – Bankrupt Internet service provider Vitts Networks Inc. must close in a month, a federal judge in Delaware has ruled.

Creditors had wanted the Manchester-based company to shut down this week, but a U.S. Bankruptcy Court judge in Delaware ruled Monday the company can operate until May 9.

The state of New Hampshire, a major Vitts customer, had wanted 60 days’ notice. Vitts, which filed for bankruptcy reorganization in February, had 3,000 customers at the end of last year, a number that has shrunk to 1,300. Vitts serves business customers in Maine, Massachusetts, Rhode Island, Vermont and New Hampshire.

Although Vitts continued to seek additional financing or a buyer after laying off 270 employees in January, no deal was reached.

Vitts has been losing about $2 million a month, court records show. Vitts has $70 million in assets and $62 million in claims against it.

“The judge essentially split the baby,” said Vitts lawyer Donald Farrell. “The creditors committee wanted the shutdown immediately. The [New Hampshire] Attorney General’s Office asked for it to be required that we stay open for another 60 days. He was trying to balance the interests between creditors and customers.”


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