Embattled telecommunications carrier PSINet Inc. said Thursday it would reduce staff over the next few weeks to cut costs, nine days after shares of PSINet Inc. halted trading on the Nasdaq exchange in the wake of company statements foretelling a bankruptcy reorganization.
A spokesman said the job cuts would take place primarily in the United States and would not impact Canada, but declined to say how many of the company’s 6,000 employees would be affected. The action reflects PSINet’s financial situation in light of “new market realities,” he said. The company also continues to seek sale of its non-core assets, he added.
PSINet faces reorganization of its US$2.8 billion debt, which the company has said could leave its shares worthless. PSINet last traded Tuesday at $0.19 per share before the halt.
The company told federal regulators April 3 that it expects auditors to issue “going concern qualifications” – an indication that the auditors don’t think the company can remain in business.
PSINet Inc. laid off 275 employees in December to address “inefficiencies” in the company, which bought 75 companies over a two-and-a-half-year period. PSINet eliminated 10 per cent of its staff earlier in 2000.
PSINet, in Ashburn, Va., can be reached at http://www.psinet.com/.
