John-
Funny you should mention the NWS article. I just read it a few minutes ago. I was wondering the same thing. Actually, I was scanning the article for any indications of which areas NWS might spend its cash.
NWS is still a definite possibility, as is HSNI. I still believe that CUC (or what will soon be called Cendant Corp., following its merger with HFS) would realize the greatest benefit from acquiring NM.
Another interesting possibility is a buyout of the NM by more than one company, much like this week's deal with AOL & WorldCom each buying parts of Compuserve. As I have suggested some time ago, it's possible that 2 or more companies could each buy the part of NM that would benefit them the most. There are several parts of the company that would work well, even when separated from each other.
Split-up scenario:
NM is acquired by HSNI, NWS & CU.
HSNI buys the infomercial-related operations, such as the telephone & order processing, the product-related assets (such as development and manufacturing, as well as product licenses and agreements), order fulfillment, etc. Included in this category might be the recent agreement with Susan Powter, for example. HSNI could use the acquired assets & operations to strengthen their home shopping programs, as well as their infomercial business.
NWS (or Guthy-Renker, of which NWS still owns >30%, I believe) might be interested in the media contracts and international programming rights that NM has established. Guthy-Renker is stronger than NM in the U.S., but NM is much stronger in the international realm. By acquiring the media contracts & such, G-R would be well-rounded globally.
CU (or Cendant) would certainly be interested in attaining the customer base (the list of all customers who have ordered something through NM). As you can imagine, that's a huge number. I'm certain that it would appeal to CU, much like CSRV's membership base appealed to AOL. By contacting this large database of consumers, CU could potentially convert each one into a CU member, leading to revenues from $25-300 annually, per person. And since most of CU's business is domestic, the international members would help the company's global reach.
So, the way I see it, NM could be worth much more than $10, whether acquired as one unit or piecemeal. Frankly, I think CU could justify paying $10 for the membership base alone. It is possible that these companies have already bought an interest in NM. Remember the equity infusion? We should see an 8-K by the weekend, detailing the agreement.
Todd |
