Analyst Pooh-Poohs Netscape-Sun
Takeover Rumors
(02/04/98; 4:15 p.m. EST)
By Gabrielle Jonas, TechInvestor
Netscape shares jumped Wednesday on
rumors that Sun Microsystems would buy the
struggling company. Investors, however,
should take the rumors with a grain of salt,
according to one analyst.
"There has been a tremendous amount of
market speculation about these guys," said Bill
Burnham, senior research analyst at Piper
Jaffray. "But I think it's more speculation than
truth. A lot of this is people just spinning tales,
although I don't think anybody would be
surprised."
Just before market close, Netscape [NSCP]
was up about 6 percent, or 1 3/16, to 19 3/8.
The company rallied as much as 13 percent
before pulling back.
Sun [SUNW] benefited from the rumor, as
well, adding 5/16 to 48 15/16.
A Netscape spokesman would not confirm or
deny that the company may be acquired by
Sun. "We're not going to comment on rumors
and speculation," Allison Johnson, Netscape's
director of corporate public relations, told
TechInvestor. "It is rumor and speculation, and
we're not commenting."
Sun, based in Mountain View, Calif., would
not return telephone calls.
"I believe it the rumor de jour, not unexpected
in the light of Netscape's difficulties,"
Burnham said. "With Netscape stock down so
much, it's the subject of a lot of speculation.
Right now, it strikes me as being more in the
rumor category than truth."
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