ExciteAtHome President denies Yahoo merger report
--------------------------------------------------------------------------------
ExciteAtHome President denies Yahoo merger report
(updates stock price in para 2, adds yahoo comment para 5, adds
background, analyst comment paras 10-15, pvs San Francisco)
NEW YORK, Aug 3 (Reuters) - ExciteAtHome Corp. ATHM.O
President George Bell on Tuesday flatly denied a report that
his Internet services company was in talks to merge with Yahoo!
Inc. YHOO.O, another top player in the field.
Bell's comments, made at BancBoston Robertson Stephens's
annual Investing in Innovations conference in San Francisco,
deflated ExciteAtHome's shares, which traded down 75 cents at
$42.19 early this afternoon after rising more than $6 earlier.
Asked to respond to a BusinessWeek Online report that the
two companies have held talks on a deal that would value Excite
AtHome at something more than its current market value around
$17 billion, Bell said there was "No truth to the story."
Asked by a reporter ahead of a speech at the conference if
his comments amounted to a denial of the merger talks report,
Bell told Reuters, "That's a denial."
Following the denial, a Yahoo spokeswoman said it was the
company's policy to not comment on rumors or speculation.
Yahoo, which was down as much as $7 following reports of
the talks, recovered somewhat to $129 after the denial, down
$3.31 on the day, before slumping again near midday to $125.
During his talk, Bell elaborated on his comments by saying
that, "We have been in talks with AOL, Yahoo, and lots of folks
about our start page." He added: "But there is no truth to the
rumors of acquisition discussions reported in Business Week."
Bell said the company is looking at ways to "monetize" the
company's "start page," the introductory Web page that
subscribers to its high-speed Internet cable modem service use
to orient themselves to features of the AtHome service.
He was referring to how other companies might be willing
pay to create links from the AtHome start page to their own
services.
The BusinessWeek Online item, which cited unnamed sources,
said the two companies have held preliminary talks over the
past six weeks about a possible deal that would extend Yahoo's
market leadership and enable it to offer new services.
ExciteAtHome itself was only recently formed through the
merger of Excite and AtHome Corp., which provides high-speed
Internet access. AtHome paid $6.7 billion for Excite in a stock
deal that was one of the highest priced Internet mergers to
date.
Web Media giant Yahoo, whose so-called "portal" site
maintains a comfortable lead over the Excite "portal," could
benefit from the AtHome broadband strategy, which would help it
deliver more services with over the Internet.
Before the denial, Wall street analyst James Preissler of
PaineWebber said the pairing would benefit Yahoo, particularly
if it resists the urge to spin off AtHome.
"Keeping the entire ExciteAtHome property could be a
positive for Yahoo," he wrote in a brief. "In essence, Yahoo
could create a broadband online service, a smaller, broadband
version of AOL (America Online Inc. AOL.N)."
But Merrill Lynch analyst Henry Blodget speculated that
Yahoo might buy ExciteAtHome and sell AtHome to AT&T Corp.
T.N. Then, through an alliance with Yahoo, "they could
potentially create a narrowband/broadband online service that
might effectively compete against America Online," he wrote.
REUTERS
Rtr 14:36 08-03-99
Copyright 1999, Reuters News Service |
