<<OT: And Now XCIT Is Sued... More On DIS...>>
This from CNET... (These suits look like a put-up
job... still interesting development)
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Excite sued for spurning buyout
By Jeff Pelline
Staff Writer, CNET NEWS.COM
June 1, 1998, 2:40 p.m. PT
Two separate lawsuits have been filed against
Excite, both alleging breach of fiduciary duty by the
search firm's rejection of a recent unsolicited
$72-per-share buyout offer by Zapata.
ÿ
The suits, disclosed in a
regulatory filing, were
filed late last month in
Superior Court in San
Mateo, California. Both
suits, one from Lazar
Blisko and the other
from Taam Associates, were "styled" as
class-action complaints, the filing stated.
They mark another twist in a story that has drawn
much attention as one of the first unsolicited bids
for a search-engine giant. Most of these companies
still are unprofitable, but their stock prices have
soared this year on Internet bullishness. Zapata
owns food packaging and fish-oil processing
businesses, but it wants to capitalize on the
booming Net market.
"The complaints seek an order requiring [Excite] to
'carry out their fiduciary duties' to the plaintiffs by
announcing their intention to cooperate with 'any
entity or person, including Zapata, having a bona
fide interest in proposing any transaction that would
maximize shareholder value, including, but not
limited to, a buyout or takeover of the company,"
the 8-K filing with the Securities and Exchange
Commission said.
The claims also sought to require Excite to
undertake an "appropriate evaluation of Excite's
worth as a merger or acquisition candidate, take all
appropriate steps to enhance the company's value
an attractiveness as a merger/acquisition candidate
(in the Taam complaint only)...[and] act
independently so that the interests of the company's
public shareholders will be protected."
In a separate development, a knowledgeable
source denied published reports that Walt Disney
Company may buy a minority stake in Excite. As
reported, Disney recently announced a buyout of
the stock that it didn't already own in Starwave.
The media giant has alluded to plans to build a Net
portal, but it has not offered any details.
Excite said it now is evaluating the complaints and
believes that they are "without merit." But the filing
warns: "These actions have not yet entered the
discovery stage and it is not yet possible to access
their ultimate outcome."
A spokeswoman at the search firm had no
comment on the lawsuits beyond the comments in
the regulatory filing.
In the 8-K document, Excite explained its rationale
for rejecting the bid. It said the so-called premium
being offered was "illusory," and it cited the "lack of
a strategic fit." The unsolicited bid, which occurred
on May 21, was "formally" rejected on May 27,
the filing added. The company said it consulted with
"financial advisers" in making its decision but did
not identify them. |
