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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: Rande Is who wrote (8565)	6/23/1999 12:51:00 PM
From: BANCHEE	Respond to of 57584

Rande Any thoughts on the deal today with MFNX and ABOV. Banchee By Bambi Francisco, CBS MarketWatch Last Update: 8:28 AM ET Jun 23, 1999 NewsWatch NEW YORK (CBS.MW) -- Metromedia Fiber Network is buying AboveNet Communications for $2 billion in stock or some $49 a share which equates to a 36-percent premium for the San Jose provider of Internet connectivity. Shares of AboveNet (ABOV: news, msgs) rose 4 1/2 to 41 over the Island ECN after falling 1 1/8, or 3 percent on Tuesday. Metromedia shares (MFNX: news, msgs) lost 2 5/16, or 5.2 percent, to 42 1/2 on Tuesday. Shares were not trading in pre-market. See Indications The deal comes amid a time the Internet co-location services and connectivity business are becoming increasingly competitive. At the same time, the increasing demand for bandwidth from Internet service providers and content providers is colliding with network providers' need to generate a meaningful return on infrastructure, said John Hodulik, an analyst at PaineWebber. "The combined company benefits both from the expertise of the data center operator and the constant supply of bandwidth a fiber-based carrier is able to deliver," said Hodulik in a note to clients. Under the terms of the deal, AboveNet shareholders will receive 1.175 shares of Metromedia stock for each share they own. "By combining Metromedia Fiber Network's virtually unlimited, pure photonic fiber network with AboveNet's high performance connectivity solutions, Internet traffic is able to flow more predictably, far more reliably and at far lower costs," said Howard Finkelstein, President of Metromedia Fiber Network, in a release. The combination provides customers "seamless, point-to-point on-demand digital service," said Sherman Tuan, Chief Executive Officer of AboveNet Communications.