NASDAQ halts PSINet trading

The NASDAQ Stock Exchange Tuesday morning halted trading of the troubled telecom carrier and ISP PSINet. The company Monday told federal regulators that it expects auditors to issue "going concern qualifications" - an indication that the auditors don't think the company can remain in business.

A NASDAQ spokesman said that the exchange has requested additional information about the company, and would allow trading to resume when it receives the data. He would not comment on the nature of the information requested.

PSINet faces reorganization of its $2.8 billion debt, which the company said in earlier statements could leave its shares worthless. PSINet last traded Tuesday at 19 cents per share before the halt.

A PSINet spokesman said that the problems the company faces are financial and not operational. "This is not a NorthPoint situation," said Eric McErlain [cq], a PSINet spokesman, referring to the recent bankruptcy and potential shutdown of the network for ISP NorthPoint. "This is not a case where customers are going to walk into their offices in the morning and the network will be shut down."

In a report filed Monday with the U.S. Securities and Exchange Commission, PSINet said it would miss the deadline for filing its financial report for 2000 because of changing financial conditions, requesting a 15-day extension. McErlain said the trading halt presumably would have been related to the SEC filing.

Fading PSINet has users in limbo
Network World, 03/26/01.

The IDG News Service is a Network World affiliate.