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Technology Stocks : AUTOHOME, Inc
ATHM 25.03-0.1%9:32 AM EST
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To: ahhaha who wrote (22659)5/26/2000 3:53:00 PM
From: KailuaBoy  Read Replies (3) of 29970
 
Here's my attempt:

(i)if TWX has a right of first refusal on MediaOne's stock,

What is the value of any stock that MediaOne might have in RR? If a third party bought the MediaOne interest in RR they would only have purchased that percentage of RR until whatever exclusive contracts that are in place expire. Upon expiration TWX/AOL would be incented to dissolve RR and take control of the TWX/AOL footprint outright. Who would purchase this temporary control other than TXW/AOL? Why would TWX/AOL pay anything to T? T must divest and there will be no buyers for what TWX/AOL will own anyway. Maybe transferring control of RR will be part of a AT&T TWX/AOL telephony deal. In exchange AOL may get access to T footprint for Internet access.

(ii) the RR exclusives in place currently prevent AOL to have access to TWX cable,

When AT&T divests RR TWX/AOL will dissolve any contracts that prevent them from operating in TWX footprint. The contracts were drawn up by UMG and TWX before the AOL bid for TWX. Take UMG out of the equation and TWX/AOL get rid of RR and brand high speed Internet in TWX territory AOL Broadband. Or they keep the RR brand and it serves as just what it is....brand.

(iii)whether MediaOne has any veto rights that could prevent the amendment of the exclusivity provisions to allow AOL onto TWX cable, or

UMG won't have the right, if it exists, after they divest. Even before they divest DOJ has made it clear that they shouldn't mess with RR. I read the DOJ decision regarding RR as "disolve your mutual interest in this thing called RR and each of you take your cable plant and go your separate ways. If you want to get together in the future and do anything you must get our permission first. Now SCAT!"

(iv) whether MediaOne can get out of the exclusivity provisions upon divestiture.

I read divest as meaning they lose any control including exclusivity.

KB
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