NaviSite Shares Rebound After Errant Report
July 15th, 2009 By: Rich Miller
Shares of NaviSite (NAVI) closed lower yesterday after the company was forced to address an erroneous report that the company’s creditors were trying to force a bankruptcy filing. NaviSite shares fell sharply in early trading after the report appeared in the Boston Business Journal, which misinterpreted information in a legal filing concerning a NaviSite customer.
Shortly after trading opened, NaviSite issued a statement correcting the report. The Boston Business Journal article “incorrectly stated that two of NaviSite’s creditors have filed to put the company into Chapter 7 bankruptcy,” NaviSite said. “The article was erroneous and the Boston Business Journal has agreed to retract the incorrect story. NaviSite is working with Optaros Inc. of Boston and TIBCO Software to put a former customer of the companies into Ch 7 bankruptcy. This former customer went out of business in early 2008 and NaviSite is working with other creditors to ensure proper recovery of the remaining assets.”
The Journal updated the story to correct the record and clarify the business relationships. NaviSite shares recovered from their lows but closed down 8 cents at $1.33 qa share, down 8 cents, or about 6 percent.