News > Technology
Webvan quits Atlanta
April 26, 2001: 10:30 a.m. ET

Online grocer names new CEO, cuts jobs, sets 1-for-25 reverse stock split
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NEW YORK (CNNfn) - Online grocer Webvan Group Inc. said Thursday it has canceled its service in Atlanta and is trimming its work force, named a new chief executive, and set a 25-for-1 reverse stock split as part of a corporate-wide restructuring effort to keep the company afloat.

Webvan (WBVN: down $0.08 to $0.16, Research, Estimates) said the reverse-split of its shares is intended to keep its flagging stock listed on the Nasdaq.

The company reported its cash position fell to $115 million at the end of the first quarter from $212 million at the end of 2000, and it is in preliminary discussions with existing investors for possible debt or equity financing of about $25 million.

Webvan also posted a narrower-than-expected first-quarter loss Thursday of 18 cents a share, a penny below Wall Street forecasts of a loss of 19 cents a share, according to earnings tracker First Call.

The company, which has about 3,500 employees, said about 485 jobs were affected by the Atlanta closing, the latest shutdown for the troubled company. It also said it is cutting about 400 jobs at its offices in Foster City, Calif., and Kirkland, Wash.

Separately, Webvan named Chief Operating Officer Robert Swan as CEO to succeed George Shaheen, who resigned April 13.

Webvan said it will continue to deliver in seven markets: Chicago; Los Angeles; San Diego; San Francisco; Seattle; Orange County, Calif.; and Portland, Ore. It shut down operations in Sacramento, Calif., and Dallas earlier this year. graphic