Geac ready to spin off real estate Web portal
inteRealty.com logs revenue of about $100-million a year
More Technology News
By DAVID AKIN
The Financial Post - March 10, 2000
Geac Computer Corp. of Markham, Ont., said yesterday it
will spin off its inteRealty.com residential real estate division, a
business-to-business portal with about $100-million a year in
annual revenue, as the software and services conglomerate
looks for a new strategy to boost what had been a sagging
share price.
Geac also announced yesterday net income of $900,000 (1c
a share) on revenue of $281.9-million for the quarter ended
Jan. 31.
The company already has investment bankers looking at the
best way to spin off inteRealty.com, a service used by more
than 250,000 residential real estate brokers throughout North
America and through which passed real estate transactions
worth $400-billion (US).
"As a conglomerate, frankly, some of the great assets within
Geac -- and this is one of the top five great assets -- get
undervalued and we're not going to tolerate that anymore,"
said Douglas Bergeron, Geac's chief executive.
"This is a company worth a lot more than its share price
currently shows and we're going to creatively mine these
golden nugget assets out of this business."
Geac made the inteRealty and earnings announcement after
the market closed yesterday. Shares in Geac closed in
Toronto up $3.75, or nearly 17%, to $25.85.
Geac named Michael Harris as chief executive of the
inteRealty business. Mr. Harris had been president of Geac
Property Systems. "The only way we can really leverage and
maximize this business's potential, and ultimately our
shareholder value, is by giving it its own wings," said Mr.
Bergeron, speaking by telephone from London yesterday.
Mr. Bergeron said the company has not decided on how
best to realize the value of the new business. inteRealty.com
will have its own share capital that it could use to forge its own
strategic relationships, exchange for equity in other companies,
or sell for cash.
"The share capital that needs to underpin the inteRealty
business needs to fully, not partially, reflect the potential that
business has. It can't within the four walls of Geac," said Mr.
Bergeron.
He added that Geac's board hasn't determined what equity
stake Geac will keep in inteRealty.com. |
