CDNow (Nasdaq: CDNW) was down 31/32 at 3 5/16 Wednesday after the company warned that it might not find a buyer or investor by the end of the month, and that any prospective offer might be at a below-market price.
The company also announced that Patrick Kerins, a managing director of Grotech Capital Group and one of CDNow’s original investors, resigned from the board because of other commitments. President Jason Olim said the company is looking for a replacement.
Earlier this month, CDNow said it expected to find a buyer or partner by the end of June, indicating that it was in talks with a number of companies after receiving more than two dozen expressions of interest. Those talks are continuing, the company said late Wednesday.
CDNow began the search for a buyer in March, as it slashed costs to keep pace with expenses after a planned merger with Sony Corp. and Time Warner Inc.’s Columbia House fell through. The company lost 17 cents per share in the fourth quarter, compared with a 9 cent loss a year earlier.
Despite its troubles, CDNow saw 4.7 million unique users in the three months ended in April, up 6.3 percent from the preceding period. Earlier this week, the company announced a marketing alliance with Time, Inc.