Mercata closes shop

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Online retailer Mercata, which promised lower prices through group buying, said it will shut down and lay off its 100 workers. The decision to shut down came only two days after the company scrapped plans for an initial public offering. The company said it was unable to raise additional funding to stay in business. Mercata filed for a stock offering last March. Launched in May 1999, Mercata was designed as a consumer shopping site, where prices dropped as more buyers agreed to buy an item. Mercata said it has already been approached by several companies interested in buying its intellectual property and physical assets. The company, said it will continue to accept orders through Jan. 31. The company received original funding from Vulcan Ventures, the venture capital unit of Paul Allen, Microsoft Corp. co-founder.

Copyright January 2001, Crain Communications Inc.

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