Info from the LA Times:
Irvine Firm's Stock Soars on Plans for Auction Web Site
Internet: 2TheMart.com's merger, online trade goals send share
prices up as much as tenfold, despite lack of details.
By JONATHAN GAW, TIMES STAFF WRITER
Los Angeles Times Thursday January 21, 1999
Orange County Edition
Business, Page 1
An Irvine company that on Wednesday said it plans to launch an
auction Web site has seen its stock soar as much as 10 times in price
this week, even though the company provided scant details about its
operation.
2TheMart.com Inc. on Tuesday purchased San Juan Capistrano-based
CD-ROM Yearbook Co. in a move to take advantage of CD-ROM's access to
public markets. A new board of directors was appointed and the company
moved to Irvine. On the same day, the stock, which is traded over the
counter, jumped from $4.50 to $13 a share.
The stock surged 65%, or $8.50 a share, to $21.50 on Wednesday, making
it the 10th-largest percentage gainer in U.S. markets. At one point, the
shares traded as high as $50. One week earlier, they closed at $2 a
share.
Before the acquisition, stock of CD-ROM Yearbook had been lightly
traded. Since the company began trading last March, there were only 19
days in which any activity was recorded. Until recently, a total of just
7,200 shares had exchanged hands at an average price of $3.48.
But on Wednesday, after the company said it would begin "one of the
largest and preeminent online auction sites," a total of 244,200 shares
changed hands.
The company said it had received $1.7 million in cash and commitments
for an additional $1.5 million to "fund 2TheMart.com's business plan,
acquisitions, strategic alliances and working capital." But the
announcement gave no details of how it would market such a site, which
would include live video auctions.
2TheMart.com and CD-ROM Yearbook officials did not return telephone
calls.
The $3.2 million in funding is less than one-tenth of 1% of the
$8.6-billion market value of EBay Inc., which 2TheMart identified as its
primary competitor.
Although the company's news release said it would launch a
person-to-person auction Web site, it also listed as competitors three
companies that do not run such auctions.
The company's Web site currently consists of several advertisements
for unrelated Internet services and a notice that a site is "coming
soon."
The name 2TheMart was registered to BLI Enterprises Ltd. in Las Vegas
and Dominic J. Magliarditi, 2TheMart.com's president. Magliarditi would
not comment beyond the news release and referred calls to his attorney,
who could not be reached. Calls to BLI went unanswered.
Magliarditi is listed as an officer of at least 12 Nevada companies
that participate in activities ranging from investment to gambling to
real estate development. In 1997, he lost a bid to gain a license to
operate a casino in Henderson, Nev.
Neither 2TheMart.com nor CD-ROM Yearbook has filed regulatory reports,
according to the Securities and Exchange Commission, but the SEC does not
require such filings from companies that are sufficiently small, a
spokesman said.
It was unclear how many shares in the company are outstanding, who its
major stockholders are or how many employees it has.
Copyright, The Times Mirror Company; Los Angeles Times, 1999.
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