HOLLYWOOD — A beleaguered AOL Latin America disclosed Tuesday that it might be forced to file for bankruptcy protection even as it rushes to sell assets or scrap operations in the region.
The company expects to run out of operating cash after the third quarter and is not seeking financing. AOL Latin America provides America Online-branded services.
According to its filing Tuesday with the Securities and Exchange Commission, the company is fielding various offers from buyers but doubts that earnings from a sale of assets would repay all of its senior convertible notes.
As a result, shareholders will not gain anything from a sale. Parent company Time Warner holds $160 million of AOL Latin America’s notes.
Media giant agreed Monday to pay $300 million to settle SEC fraud charges of inflating online ad revs and customer rolls at AOL in the U.S. (Daily Variety, March 21).