Monetize SB Article (SI Message 692 in BNYN)
To: mcbride (692 )
From: James H. Irwin Wednesday, Feb 10 1999 11:47AM ET
Reply # of 807
Picked this up from the "backdoor IPO" thread:
BNYN News about possible Switchboard IPO soon.
Technology News
Tue, 09 Feb 1999, 2:12pm EST
Banyan Systems Sees Big Value in Internet Unit: Bloomberg Forum
Banyan Systems Sees Big Value in Internet Unit: Bloomberg Forum
Westboro, Massachusetts, Feb. 9 (Bloomberg) -- Banyan
Systems Inc. has been in discussions with other companies about a
strategic partnership with Switchboard, its Internet directory
unit, Chief Executive William Ferry said.
The provider of computer networking software and services
also could sell shares of Switchboard, which provides residential
and phone directories, in an initial public offering, Ferry told
the Bloomberg Forum.
''It's logical to expect we would want to monetize our
investment in Switchboard,'' Ferry said. A strategic partnership
might include an equity investment in the unit, he said.
Banyan's Switchboard unit had $1.8 million in revenue in the
fourth quarter, and expects to increase sales by 75 percent to 80
percent in 1999, Ferry said. The company is going to focus on
selling local advertising on Switchboard, which gets about 70
percent of its current revenue from national advertisers.
Banyan Systems' shares dropped 16 percent on Dec. 10 after
the company said its contract to provide yellow pages information
to America Online Inc. wasn't renewed. That will free it up to
seek other marketing agreements with rivals to America Online,
Ferry said.
''A number of AOL competitors were uncomfortable with'' the
Switchboard contract, he said. ''Now, the numbers of inquiries
about closer partnerships has gone up dramatically in the last
four to six weeks.''
Since the announcement of the loss of the AOL contract,
Banyan's shares have rebounded 85 percent.
Westboro, Massachusetts-based Banyan has two other
divisions, one that sells professional services and another that
makes software programs such as StreetTalk, which helps people
find data on corporate networks.
The company's professional services unit should see its
revenue increase by 50 percent to 60 percent in 1999, Ferry said.
The software unit's sales may not grow, or grow only by a single-
digit percentage, he said. The company's coming out with several
new programs this year that should boost software sales farther
ahead, he said.
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The IPO will come at some point. Just sit back and be patient.
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