Roger, I also own both Go2Net and Infospace.
After the initial shock of this announcement, I'm starting to think it might be very positive. Both companies:
Have lots of cash -- The combined company will have about $450 million in current assets.
Are on very steep growth curves -- GNET's revenue of $23 million last quarter was a 300% increase over the same quarter last year. INSP's revenue of $24 million last quarter is a 250% increase.
Are or will soon be profitable -- On a pro-forma basis, GNET earned .22/share (beating estimates by seven cents)and INSP is within a penny of profitability (beating the street by a nickle).
Have great management -- GNET share holders know how good Russell and his team are. Jain and his team are also visionaries, and are tireless promoters and deal makers.
Together, these companies will have:
More promotion and street recognition -- This deal should overcome what GNET has lacked in visibility and advocacy on the street. Infospace is one of Henry Blodgett's favorites, and with Merrill and Morgan advising on this deal, we should see more recognition from the big players.
Great customer and distribution bases -- INSP has access to 88% of all North America cellular subscribers, GNET has broadband agreements and partnerships (e.g., Charter), and together they have a network of nearly 2 million merchants that they are selling services to.
I was initially sorry to hear that Go2Net is being acquired, but based upon the above and the fact that Russell will be a key Infospace officer, I think I will hold onto my Infospace and Go2Net shares.
All the best, Kevin (#37) |
