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News > Deals
NorthPoint vows legal action
December 1, 2000: 1:18 p.m. ET

Company charges Verizon illegally terminated pact to buy 55% stake
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NEW YORK (CNNfn) - NorthPoint Communications will definitely take legal action over Verizon Communications' decision to terminate agreements to buy a 55 percent stake in NorthPoint and merge the companies' DSL businesses.

A spokesman for NorthPoint said Friday the company would take legal action, but could give no details because the company's lawyers are still "hashing out" which course of action to take.

graphicNorthPoint maintains that Verizon was not entitled to end the agreements.

A Verizon spokesman reaffirmed his company's stance, which disputes NorthPoint's contention and maintains the company terminated the agreements due to material changes.

Analysts have expressed concern about NorthPoint's ability to stay afloat without funding from Verizon. Verizon intended to pay $800 million for a 55 percent stake, with $450 million going to operational funding.

Shares of NorthPoint (NPNT: Research, Estimates) lost the majority of their value after Verizon's decision Wednesday. The stock fell 9 cents to 50 cents in afternoon trading on the Nasdaq.

Shares of Verizon (VZ: Research, Estimates) fell 6 cents to $56.12 on the New York Stock Exchange. graphic

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