ICGE news from ICGE thread:
To: Mohan Marette who started this subject
From: albert kovalyov Monday, Oct 23, 2000 4:36 PM ET
Reply # of 1695
<font color=red>Internet Capital Seeks to Better Explain Self After Stock Drop
Internet Capital Seeks to Better Explain Self After Stock Drop
10/23/0 11:6 (New York)
Internet Capital Seeks to Better Explain Self After Stock Drop
Wayne, Pennsylvania, Oct. 23 (Bloomberg) -- Internet Capital
Group Inc., its stock down 95 percent from its peak, is planning a
national ad campaign aimed at better explaining its portfolio of
72 business-to-business electronic commerce companies.
Wayne, Pennsylvania-based ICG is in the midst of planning a
television and print campaign, for which it doesn't yet have a
budget, and will publish two 36-page inserts in CEO magazine
describing the 4-year-old company and its strategy, said Karen
Francis, chief marketing officer and managing director.
``Investors are finding it harder to model ICG and we want to
make it easier to understand,'' said Francis, who joined ICG in
April from General Motors Corp., where she was general manager of
the Oldsmobile division.
ICG has been hammered on investor concern about when it will
be consistently profitable and whether it can withstand
competition from online exchanges formed by industrial companies.
ICG invests in startups that are either building such exchanges or
providing services to the companies that use them.
Even during an almost three-fourths decline in its share
price since early September, ICG executives have continued to
speak at conferences; they plan a call with analysts when third-
quarter earnings are released Nov. 8. They've been speaking about
ICG's strategy of backing companies that use Internet technology
to achieve cost savings by linking buyers and sellers in
fragmented industries.
`Very Open'
``We've spoken when scheduled, we've been very open,'' said
Francis in the first extensive interview by an ICG executive in
six weeks.
ICG hasn't had an initial public offering by one of its
portfolio companies since technology stocks collapsed in March,
and three planned IPOs were canceled in the second quarter. The
company depends in part on cash it takes in from such transactions
to fuel future investments.
In August, ICG Chief Executive Walter Buckley said the next
portfolio company IPO would likely occur in September. Instead
there was another cancellation, with online industrial exchange
builder Commerx Inc. withdrawing its IPO plans Oct. 13.
``Investors understand that market acceptance of IPOs is not
something we can control,'' Francis said. ``Obviously we're
conserving and being really responsible with our cash and we
understand what it takes to move forward.''
ICG had about six months of cash remaining in early August,
though it said it would sell some assets and raise money from
large corporate investors, particularly to fund its European
expansion.
Strategic Investors
``We continue to have discussions with possible strategic
investors and corporate partners who are approaching us to try to
understand how best to work with us,'' Francis said. ``Those
conversations continue and are moving along,'' and could result in
announcements by year-end or in the first quarter of 2001.
The company is also focused on helping portfolio companies
increase revenues and operating profits, something it's well-
equipped to do because many of its top executives have come from
large publicly traded companies, Francis said.
Now those executives are attempting to explain the opposite
end of the corporate spectrum: the privately held companies in
ICG's portfolio, the value of which are difficult to assess.
``There's a definite focus on our private companies,'' she
said. ``Everyone has visibility into our public companies, the
private ones are harder.''
ICG has investments in seven publicly traded companies,
stakes worth a total of about $1.3 billion. All seven of those
companies have seen sharp share price declines this year, ranging
from 62 percent to 97 percent. The company's most valuable
holding: a 29 percent, $774 million chunk of VerticalNet Inc., a
builder of online industrial trading communities.
CMGI Moves
ICG has no plans to group its companies into a handful of
business units, as CMGI Inc., another investor in Internet
companies whose shares have slumped, did last month.
``We don't believe that creating a grouping is going to give
an insight into individual models and companies,'' she said.
``Obviously the stock being what it is is something that we're
interested in and we want to make sure investors' concerns are
addressed.''
Even with its share price decline, Francis said only two ICG
managing directors have left or announced plans to leave since the
company's August 1999 initial public offering.
``It's not about any irrational stock valuations that have
been on the table,'' she said. ``I always get asked, `When did you
join?' to see if I was there before the IPO. But I didn't join
this company to leave it in six months, I joined it because of the
vision.''
ICG rose $1.83, or 12 percent, to $12.44 in early trading.
The stock is up 34 percent in three days since falling to $9.25 on
Wednesday, just $3.25 above its IPO price of 6.
--Randy Whitestone in the New York newsroom (212) 940-1805, or at
rwhitestone@bloomberg.net/jk
Story illustration: to track the performance of Internet Capital
stock, enter {ICGE US <Equity> GPCT <GO>}.
ICGE US <Equity>
EMRG US <Equity>
BWAY US <Equity>
ONVI US <Equity>
UAXS US <Equity>
USIT US <Equity>
715 HK <Equity>
VERT US <Equity>
NI WNEWS
NI HWY
NI SOF
NI VC
NI VNT
NI COS |
