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Pets.com is being put to sleep.

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Pets.com

Pets.com is Out of Business

The San Francisco-based online retailer, known for its commercials with a sock puppet dog and the slogan ”Because pets can’t drive” — said yesterday it is closing down after failing to find a financial backer or buyer.

Pets.com said it is laying off 255 of its 320 employees and plans to sell the majority of its assets, including inventory, its distribution center equipment, its Web site address and its Sock Puppet brand. The company turned the company mascot into a marketing icon this summer, selling the licensed puppet, along with accessories, to toy stores nationwide.

The company’s e-commerce site will no longer be taking orders after tomorrow. John Cummings, director of investor relations, said Pets.com aims to fulfill all of its outstanding orders online and offline.

Shares of Pets.com lost two-thirds of their value yesterday, falling 44 cents to close at 22 cents a share on the Nasdaq Stock Market.

”It is well known that this is a very very difficult environment for business to consumer Internet companies,” said Julie Wainwright, Pets.com chairman and chief executive. ”With no better offers and avenues effectively exhausted, we felt that the best option was an orderly wind down with the objective to try to return something back to the shareholders.”

The somber scenario is drastically different from when Pets.com burst on the scene in February 1999. Pets.com, along with its rivals, moved into an area that was much hyped as a potential gold mine, but never lived up to its promise.