Is Cybercash crumbling or simply restructuring..? Anyone here using them? My boss showed me an email today we received from some exec. over there saying that some merger deal with another financial firm fell through and they (Cybercash) have chosen to file for bankcruptcy in order to let the other company buy them over. Is this really the case or is the a dead rat some were? And what can companies using their services really expect? Any clues?

Directly from the Cybercash web site:

CyberCash Restructuring Letter to Customers
March 2, 2001

To Our Valued Customers:

As many of you know, on December 14, 2000, CyberCash announced its intention to merge with Network 1 Financial Corp., a premier supplier of payment processing systems and Internet payment services, to create a single entity to offer the industry's most fully integrated payment solution for both Internet and physical world merchants. The combination of CyberCash and Network 1 would enable CyberCash to offer its customers a one-stop solution for payment processing and merchant account services packaged for simplicity and economy.

While we have made tremendous strides over the last several months in completing the merger, conditions in the capital markets prevent CyberCash from completing the financing necessary to close the merger as planned.

In light of these events, the companies have terminated their existing merger agreement and have entered into an asset purchase agreement under which Network 1 will acquire all of CyberCash's operating assets. As part of this strategy, CyberCash today elected to utilize the procedures offered by Chapter 11 of the U.S. Bankruptcy Code.

Please rest assured that we will continue to provide the same high quality customer service that has made us the world leader in payment processing. As these plans develop, we will send you additional communications.

For more information, please go to http://www.cybercash.com/restructure.

Sincerely,

Daniel Lynch
Chairman and CEO
CyberCash Inc.

If they were a world leader they wouldn't be bankrupt.

Filling for Chapter 11 is NOT bankruptcy, that's Chapter 13, they are doing this because they don't have the funds for a merger (and mergers do cost a lot of money). Technically speaking, they are filling for bankruptcy, however, in reality this is just a cheaper way for companies to merge.

Anyway you slice it, things didn't go well for Cybercash.

IMO, while their system was good, it was waaaaaaaay too complex to setup for the "common" e-commerce site.

Saw this comming when the stock price took the big hit.