"RedChip's roller coaster ride began in September 1999, when Southern California investment bank Cruttenden Roth bought a majority stake from founder Marcus Robbins."
LATEST NEWS
July 31, 2001
RedChip.com put in play again
Robert Goldfield
The staff at small-cap researcher RedChip.com can look on the bright side: someone always seems willing to buy the company.
Officials said Tuesday that Portland-based RedChip.com would change hands for the third time in the past two years.
Online financial company FreeRealTime.com Inc. (OTC Bulletin Board:FRTI) said it has agreed to sell substantially all of the assets of its RedChip.com Inc. subsidiary to RedChip Cos. LLC, a company recently formed by ICM Asset Management of Spokane, Wash. The buyer will pay consideration in the form of an unspecified amount of cash and the assumption of certain liabilities. RedChip.com, originally known as Red Chip Review, is a financial research firm covering small cap and emerging growth public companies.
FreeRealTime said the consummation of the asset sale is subject to certain conditions, including the receipt of a fairness opinion on the transaction from a third party investment banking firm, and the approval of a majority of FreeRealTime's shareholders.
Until the asset sale is completed, the newly formed RedChip Cos. will operate RedChip.com pursuant to a management agreement. It will also provide all funding required to operate RedChip.com during that period.
RedChip's roller coaster ride began in September 1999, when Southern California investment bank Cruttenden Roth bought a majority stake from founder Marcus Robbins.
In June 2000 RedChip.com was merged into FreeRealTime of Irvine, Calif. FreeRealTime said then it desired to create the internet's "premier vertical finance portal" providing "real-time actionable insight" to independent and institutional investors. It planned to issue 4 million shares to the RedChip.com shareholders who would end up holding one-third of the combined company.
Troubled times followed, however, and in March 2001 the Portland office laid off nine people.
"The anticipated synergies between FreeRealTime.com and RedChip.com were certainly challenged by a tumultuous stock market, as well as an adverse on-line advertising environment which was historically FreeRealTime.com's primary revenue source," Michael Neufeld, FreeRealTime.com's President and CFO. "
Neufeld said it is anticipated that FreeRealTime will market RedChip.com research products to FreeRealTime's online audience.
FreeRealTime will now focus on its core businesses surrounding its FreeRealTime.com web site, as well as continuing efforts to explore a sale of FreeRealTime, Neufeld said. He said FreeRealTime is cutting costs and intends to lessen reliance on advertising revenue by offering new subscription based, or pay-for services.
Neufeld didn't say so, but presumably, that might lead to a name change--perhaps something like NoLongerFreeRealTime.com.
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