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Print Edition StoriesFriday, September 12, 2008
Cyphermint seeks bidders as ex-CEO seeks more time
By Efrain Viscarolasaga
Cyphermint timeline
After entering into involuntary Chapter 7 bankruptcy this summer, Marlborough-based mobile payments technology developer Cyphermint Inc. went on the auction block this week, with trustees hoping to increase the standing bid of $100,000.
Last week, a Worcester bankruptcy judge appointed one of the firm’s creditors, New York-based C.A. Acquisition Corp., as a temporary management group, pending a sale. C.A. Acquisition has placed the first bid on Cyphermint.
Offers for the company are due before Sept. 25, and the court-appointed trustee, Joseph Baldiga of Westborough-based Mirick, O’Connell, DeMallie & Lougee LLP, has established a “due diligence room” at the company’s headquarters for interested parties.
Also included in the deal is Cyphermint’s long-standing relationship with package delivery company DHL International Ltd., which has been a customer since 2005. According to Baldiga, that relationship is “being maintained.”
The auction, however, has received a limited objection from the company’s former CEO, Joseph Barboza. While Barboza’s attorney declined to comment, court documents Barboza filed said that C.A. Acquisition made a $3.3 million bid for Cyphermint last spring, placing a $300,000 deposit and taking control of the day-to-day operations, while neglecting to pay certain creditors. Those creditors forced the company into bankruptcy, a situation that placed an accelerated timetable on the auction, which Barboza’s affidavit calls “synthetic.”
Barboza’s objection seeks to deny the accelerated sale process requested by Baldiga and approved by the court.
Cyphermint’s funding history is vague, but court documents and published reports indicate the company raised $5 million in funding from Russia-based Promtex LLC and SIA AMTO in early 2008.
The company was originally founded in Russia in 2000 and relocated to the U.S. that year.
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