Well look here
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E*Trade (EGRP) -- The No. 2 online brokerage plans to form an investment bank that would raise capital by selling securities to investors over the Internet, a person familiar with the company said. The goal is to shave 30 percent off the cost of a corporate-securities offering to about 4.5 percent of the amount raised, compared with a traditional investment bank's 7 percent. E*Trade rose 20 7/8 to a record 88 1/2.
As described in Note 2 to the consolidated financial statements, on May 4, 1998, Softbank completed a reorganization whereby the common stock of ZD Inc. and ZD Events Inc. were contributed to the Company by SBH in exchange for 73,619,355 shares of the Company's common stock.
Concurrently, the Company (i) completed an initial public offering of
25.8 million common shares at $15.50 per share, (ii) issued $250 million of 8 1/2% Subordinated Notes due 2008, (iii) entered into a $1.35 billion credit facility with a group of banks under which $1.25 billion was borrowed and (iv) converted $908.7 million of intercompany
indebtedness to equity. In addition, the Company received $9.1 million
of fixed assets from Kingston, an affiliated company, in exchange for
580,645 common shares of the Company. These transactions are
collectively referred to as the Reorganization. Total shares of common
stock issued to Softbank and its affiliates were 74,200,000. Net
proceeds from the Reorganization of approximately $1.9 billion from the initial public offering, subordinated note and credit facility were used to complete the purchase of the MAC Assets for $370.0 million and repay intercompany indebtedness. On May 14, 1998, an affiliate of Softbank sold 50,000 shares of the Company's common stock to an unrelated third party. On May 28, 1998, the Company's U.S. underwriters exercised their option to purchase 2.0 million additional shares of common stock to cover over allotments
Softbank peeled off another $400 million and bought close to 16 million shares of E*Trade Group (EGRP:Nasdaq), the Internet brokerage firm.
"And what precisely did E*Trade do with the $400 million? Well, according to its most recent financial filing, for the fiscal year that ended Sept. 30, no sooner did E*Trade get the money than it signed an "extensive advertising, sponsorship and promotional program" on the Yahoo! Web site. we find a Yahoo! confession that during the July-September 1998 period, advertising revenue from "Softbank ... and its related companies" leaped from 4% of Net revenue to 8%. In other words, folks, more than one-third of Yahoo!'s total sequential revenue growth during the period came directly from Softbank-financed advertising -"
So if I get this right the complaint is that Softbank reallocated money from one of its investments to invest in Yahoo its Search Engine [portal company] and its on line brokerage company EGRP. Are they doing this to create a shell game? Is Yahoo not one of the most often hit sites on the net? Is not EGRP growing rapidly and now the second largest on line broker. The fact that they are advertising on Yahoo to gain market share seems like a natural. Doesn't cbs advertise cbs on line. Doesn't cnn advertise on cnn-fn. This practice is pervasive. What IMO we are talking about here is growing the net and specifically E commerce be it from advertising or trading or now investment banking. It doesn't sound like sour grapes its sounds like the street.com is making some assumptions or implying some wrong doing
ZD the company
ZD: 18 3/16 , + 11/16 Retrieved Mon, Jan 11, 04:19 PM EST
Company InformationCompany Name:Ziff-Davis Inc Address:One Park Ave.
New York, NY 10016 Telephone:(212) 503-3500 Exchange:NYS S&P Industry:
Publishing Status:Active Incorporation:DE
Description of Business Operates an an integrated media and marketing
company focused on computing and Internet-related technology, with
principal platforms in print publishing, trade shows and conferences,
online content, market research and education.
Share InformationMarket Capitalization (Mil):$ 1,818.75 Current
Outstanding Shares (000's):100,000 Number of Institutional Shareholders:66 Shares Held By Institutions (000's):17,386 Percent Shares Held By Institutions:17%
quicken.excite.com
The problems with ZD is its business advertising is down. It is an internet marketing and media company. The fact that others were willing to buy Softbanks shares and that institutions hold 17% of the shares suggests to me that this is not smoke and mirrors but a business decision made by the Softbank board in what they believe to have been the interest of there company and investments.
OT this AM Goldman Sachs announced the resognation of the CEO. Another in a string of coincidences? Perhaps. But it looks to me like they are all about the wave of the future.
Regards
Norden |
