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Technology Stocks : America On-Line: will it survive ...?
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To: Todd Daniels who wrote (4725)9/8/1997 4:13:00 PM
From: J.S.   of 13594
 
"BTW, Case valued the CSi subs at $250m, or about $100 ea.
If AOL average monthly revenue per sub ($16.77) is only 15%
greater than CSi ($14.58), are AOL subs worth the $800 the
market is valuing the combined 11.6m at? Sure a premium is
warranted. But is it eight times? "

Another way to look at this is that HRB and CSRV got taken to the
cleaners. CSRV paid over $100M for SPRY alone when SPRY was a tenth
the size of what it is now. Sears and IBM dumped Prodigy for much more per sub. CSRV has almost $300 million net working capital. If they
had sold CSi to AOL for that price (with Bert. AG's help) the rest
of the company with now more that $500 million net working capital
would have fetched much more that $1.2 Billion. WCOM looked at
CSi as excess baggage only AOL would want.

Joe
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