U.S. company CompuServe pulled out of similar talks with EOL on Friday, claiming no agreement could be reached within the time limit imposed by the Luxembourg Court of Commerce, where EOL had filed for bankruptcy protection..
However, CompuServe's partner in those discussions, ITT Corp., is understood to be continuing discussions with the Luxembourg-based Europe Online. US-owned ITT wants to use EOL as a platform to promote its numerous travel and tourism interests which include its ownership of the international hotel chain the Sheraton.
EOL's future has been thrown into turmoil by German publisher Burda which decided to freeze all financing for the company last month. Burda's 33% stake in Europe Online is also in question, unless the company can tie in new investors, according to sources close to the Luxembourg-based operation.
Europe Online has amassed 70,000 subscribers since its inception in January - far short of both CompuServe (700,000 in Europe alone) and Deutsche Telekom's T-Online (over a million subscribers).
Deutsche Telekom's T-Online does not operate outside of Germany. By buying into Europe Online, it could move abroad more easily. The German phone company supplies Europe Online with data network lines, through which subscribers can access services such as online magazines.
There are currently 15 different small investors in Europe Online, including British media group Pearson, US telecoms company AT&T as well as numerous banks and private stake holders.
CompuServe says it is still looking for a combination of acquisitions and organic growth in Europe. Its European subscriber numbers have doubled in the past 12 months.