From Bloomberg:
Excite At Home Confirms Talks With Internet Rivals (Update2)
Excite At Home Confirms Talks With Internet Rivals (Update2) (Adds company comments, details about page views, Circuit City agreement.)
Redwood City, California, July 20 (Bloomberg) -- Excite At Home Corp. said it is in talks with rivals regarding possible transactions with the provider of high-speed Internet access.
Chairman Tom Jermoluk said the company has been in talks with America Online Inc., Yahoo Inc., Microsoft Corp., Walt Disney Co. and Infoseek Corp.
Shares of Excite At Home, whose largest shareholder is AT&T Corp., have nearly doubled over the past year on takeover speculation and as the company expanded its content to attract users to its service, which provides high-speed Internet access over cable-TV Lines. Jermoluk said on a private conference call today that Excite At Home is in talks with Internet-related companies about possible transactions to quash any speculation that other companies are bypassing Excite At Home to have discussions with AT&T. ''It is absolutely true that we are in, and have been, in discussions with AOL, Yahoo, Microsoft and Disney-Infoseek,'' Jermoluk said. ''I can't comment on any deals.''
AT&T owns 26 percent of Excite At Home, and holds a 57.9 percent voting stake. In making its announcement today, Excite At Home stressed that it -- and not its largest shareholder -- will be in charge of discussions about partnerships, content agreements and other transactions.
Reduce Speculation ''We wanted to reduce the speculation on the Street that any of those companies were going directly to AT&T to cut their own deal,'' said President George Bell. ''All of those substantive conversations are being driven by AT&T through the management of Excite At Home because we are the horse they are riding.''
Bell said the conversations are complex and he doesn't expect any agreements to be struck soon.
Bell and Jermoluk's comments came after the Redwood City, California-based company reported a second-quarter loss.
Excite At Home's service is attractive to Internet content providers as a platform for broadband services, including super- fast Internet access, phone service and interactive entertainment.
This is the first quarter that the company's results will include Excite, the No. 2 Internet search service, which it acquired for $8.26 billion.
Quarterly Loss
Excite At Home said its loss was $217.9 million, or 76 cents a share, from a loss of $24.8 million, or 11 cents, in the year- earlier period. Revenue rose to $70.5 million from $9.2 million. The figures include Excite's results from May 28, when it was acquired by At Home Corp.
The company also reported a loss before acquisition, distribution and other costs of $5.9 million, or 2 cents a share, compared with $17.1 million or 5 cents, in the year-ago period. On this basis, the company was expected to report a loss of 2 cents a share, the average estimate from First Call Corp. ''The bottom line is: Are they growing subscriber numbers? If not, that's the question mark over the stock,'' said John Corcoran, an analyst at Stephens Inc., who rates the stock ''buy.''
The company said it had 620,000 subscribers as of June 30, from 460,000 subscribers in March.
If the companies had been combined last year, second-quarter revenue would have been $100.4 million, compared with $42.2 million, on a pro forma basis.
The company was expected to generate revenue around $90 million and report subscribers of 600,000 to 620,000, according to a survey of two analysts.
The pro forma loss was $249.1 million, or 69 cents a share, compared to $274.8 million, or 77 cents a year earlier.
Page Views
The company said it had 81 million page views a day in June from 77 million page views in March. A page view is one electronic page of information displayed upon a user's request.
The number of registered users rose by 36 percent to 38 million.
Excite At Home said it signed an agreement to sell its high- speed Internet service through Circuit City, the No. 2 U.S. consumer-electronics retailer. It will be available in selected retail stores in major U.S. markets.
Excite At Home will sell the At Home cable Internet pre- installation kit. Customers will be able to try the At Home service, call on a hotline phone to a cable company representative to sign up and arrange installation.
The Excite At Home service is available to home subscribers in the U.S. and Canada, including Toronto, Calgary, Vancouver, Baltimore, Detroit, Seattle, Philadelphia, San Diego, Phoenix, Sarasota, Florida; and Hartford, Connecticut. The service is available to corporate subscribers in areas such as Chicago, Los Angeles, New York, San Diego, San Francisco, Seattle and Washington.
Shares of Redwood City, California-based Excite At Home fell 1 11/16 to 45 1/16. The results were released after the close of U.S. trading. |
