MindSpring Enterprises (MSPG) Another ISP. Message Board

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Technology Stocks : MindSpring Enterprises (MSPG) Another ISP.

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To: Glenn Petersen who wrote (1174)	7/17/1999 1:38:00 AM
From: Mohan Marette	Read Replies (1) of 1434

Talk Lifts MindSpring Shares Despite the warnings of Messrs. Dell and Meredith, shares of MindSpring Enterprises Inc. climbed Friday on speculation that the Internet-service provider could be in talks with Dell for a possible business deal. Investors think MindSpring is a potential candidate as a party to Dell's U.S. Internet-access service plans because MindSpring has said twice within the past month that it is in discussions with an unidentified party for a possible business combination or other alternative. A MindSpring spokeswoman declined to comment on the speculation. Ladenburg Thalman & Co. analyst Youssef Squali said he doubts Dell would make an outright acquisition of an Internet-service provider because the relatively high valuations of such companies' stocks would reduce Dell's earnings. Instead, Dell might strike a strategic partnership with an Internet-service provider, a deal that could involve a partial equity transaction, Mr. Squali suggested. "It would make sense for some sort of alliance," he said. Last week, MindSpring canceled a meeting with analysts, citing ongoing talks with the mysterious party. The company's shares climbed $1.75, or 3.7%, to close at $48.75 Friday on Nasdaq. Sands Brothers analyst James Waggoner also thinks an alliance between Dell and MindSpring would be more likely than a Dell acquisition of MindSpring, assuming the companies are in talks. But in addition to MindSpring's high valuation as an obstacle, Mr. Waggoner cites MindSpring's "free-lance and free-spirit" corporate culture, which might clash with Dell's more established atmosphere. A partnership between Dell and MindSpring would expand Dell's customer base by accessing MindSpring's roughly one million subscribers, Mr. Waggoner said. The incentive for MindSpring and other Internet-service providers in such an alliance is to secure funding to remain competitive in a consolidating industry. Message 10546855

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