Loss-making Lycos Europe is to be broken up and some parts of the business closed down, resulting in hundreds of redundancies.
The main Lycos business is owned by South Korean internet firm Daum Communications. The failing Lycos Europe business is controlled by German media group Bertelsmann and Spanish telecoms company Telefonica.
The plan to sell some parts of Lycos Europe and close other operations is expected to lead to hundreds of redundancies, mainly in countries including Germany and The Netherlands, where the firm has its headquarters.
Lycos Europe has suffered from falling web advertising and service revenue, in a similar way Yahoo has suffered on a global scale.
An investor had previously been sought for the operation, but Lycos management has failed to find one. The web hosting and most of the portal operations are now expected to be closed down.