ALTA--- IPO, here we go!
Friday December 17, 6:54 pm Eastern Time
FOCUS-Internet search engine AltaVista seeks IPO
(Adds CMGI details in paras 5-7, Compaq in paras 12-15.)
By Jeremy Pelofsky
WASHINGTON, Dec 17 (Reuters) - Internet search engine AltaVista Co., mostly owned by online venture firm
CMGI Inc., (NasdaqNM:CMGI - news) filed with U.S. regulators on Friday to sell stock to the public to raise as
much as $300 million.
AltaVista offers advanced Internet searches and online shopping through Shopping.com. It also allows users to set up e-mail accounts and
recently began to offer instant messaging, one of the latest electronic communications crazes.
CMGI holds 82 percent while Compaq Computer Corp. (NYSE:CPQ - news) holds about 18 percent of Palo Alto, Calif.-based AltaVista, which
has about 45 million unique visitors each month to its Web site altavista.com.
AltaVista's preliminary prospectus filed with the Securities and Exchange Commission did not disclose how many shares it plans to sell or the
projected range per share.
This is just the latest in a series of good news for CMGI shareholders this past week. Chief Executive David Wetherell said earlier today the
company was considering spinning off another of its prized cards, AtVentures which itself holds investment stakes in about 45 Internet
businesses.
Plus, CMGI this week gave investors early Christmas presents by announcing a two-for-one split of its stock, the $500 million acquisition of
yesmail.com Inc. (NasdaqNM:YESM - news) as well as consensus-beating earnings.
It also appears that CMGI is not done, it filed with the SEC to raise up to $1 billion from the periodic sale of debt and equity that could be used
for future acquisitions, working capital, debt retirement and other business opportunities.
ALTAVISTA ATTRACTS
Meanwhile, AltaVista said it plans to use the proceeds from its IPO for advertising, working capital, possible acquisitions or joint ventures and
other general corporate purposes. It has applied to sell its shares on Nasdaq under the symbol (NasdaqSC:ALTA - news) ``ALTA'.
AltaVista had about $52.6 million in revenue during the three months ended Oct. 31, and posted $267.7 million in net losses during that period,
according to the filing. About 635 people were employed by the company at the end of November.
To attract more users, the search engine company has established relationships with other companies ranging from CBS Marketwatch.com to
The New York Times to Ask Jeeves.
AltaVista originally operated within Digital Equipment Corp., which Compaq acquired in June 1998. In August 1999, CMGI bought its majority
stake of the Compaq unit which retained about 18 percent of AltaVista.
Following the sale of AltaVista to CMGI in late June, Compaq received common and preferred stock amounting to 16.4 percent of CMGI, while
retaining a 17 percent stake in AltaVista.
MORE PROFITS ONLINE
Since acquiring the ownership interest in CMGI, the value of Compaq's holdings in CMGI has mushroomed to $4.5 billion from around $2 billion
in stock at the time of the deal last summer.
The massive, although unrealized, gain in the value of Compaq's CMGI stake is worth more than world's top PC maker has reported in profits for
the past three full years of operations.
A spokesman for Compaq said its chairman said at the time of the deal's closing that Compaq's holdings in CMGI and AltaVista marked a
long-term partnership among the companies that has included Compaq business ties to several CMGI Internet companies.
Altavista's online search engine operates in one of the most competitive environments of the Internet, facing rival search engines run by
companies such as Yahoo! Inc., (NasdaqNM:YHOO - news) Lycos Inc., (NasdaqNM:LCOS - news) and CNET Inc. (NasdaqNM:CNET - news)
Rodney Schrock, 40, has served as AltaVista's president and chief executive since January 1999.
The underwriters include Morgan Stanley Dean Witter, Hambrecht & Quist, Robertson Stephens, Prudential Volpe Technology and Wit Capital
Corp. |
