From today's Bear Stearn's FHT report:
*** FHT announced that it has taken a 20% equity stake in Roxy
Systems, marking Fingerhut's fourth Internet Investment in the
past six months. Management also has warrants that take its stake
up to 51%, and they indicate that a public offering for Roxy
could be explored in late 1999 or early 2000.
*** Roxy Systems is an on-line retailer of home satellite
television, digital wireless phones, and Internet services,
direct to the consumer, with estimated annual sales in the $7 to
$8 million level.
*** Roxy has three of its own sites (www.roxy.com,
www.pcscentral.com, and www.satellite.com) as well as on-line
partnerships with Excite, Sportsline, Yahoo!, ESPN.com,
Nascar.com, and others. With its equity investment in Roxy,
Fingerhut effectively has 11 web sites currently operating.
*** Fingerhut brings four things to the table here, besides
capital:
1. Traffic-generated through FHT's other web sites and links,
inserts in packages, and messages on billing statements
2. Promotion-through its sweepstakes, database capabilities,
and 2200 tele-marketers
3. Merchandising-Roxy will able to expand its limited product
assortment by selling some of Fingerhut's extensive electronics
offering.
4. Fufillment-By fulfilling for Roxy, FHT is able to continue
to leverage its underutilized distribution capacity. Fingerhut's
efforts should also lead to some back office expense savings for
Roxy. |
