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Technology Stocks : INFOSEEK (GO) -- Ignore unavailable to you. Want to Upgrade?

To: SHGLaw who wrote (9237)	7/13/1999 4:21:00 PM
From: RealMuLan	Respond to of 9343

Wonder how Eisner value SEEK? <<In a telephone interview, Disney chairman Michael Eisner called the Disney brand name the "lifeblood" of the global entertainment empire and said creation of Go.com would give investors a role in deploying that "critical asset" to the Internet. He noted that the stock market had already boosted Infoseek shares after Disney officials disclosed three weeks ago that they were contemplating the move. "This may be buy on the rumor and sell on the business," he said. "We are benchmarking it [Infoseek stock] at $38 a share. I think it will become clearer and clearer as time goes by how reasonable this deal is." >> washingtonpost.com He was robbing people while their houses were on fire.

To: SHGLaw who wrote (9237)	7/13/1999 4:29:00 PM
From: RON HOROWITZ	Read Replies (1) \| Respond to of 9343

Lets be real, if SEEK has great numbers this quarter or next the situation takes care of itself. Disney was smart not putting up cash, why should they bankroll something so volatile when they can issue stock? Longterm I don't think Disney wants to see this stock take a beating, there's nothing in it for them. Listening to Eisner he mentioned broadband and streaming video as areas of interest. If internet valuations hold and business on the internet is as big as most everyone thinks, this could be a great deal. A lot of ifs makes a stock deal a lot smarter than cash.

To: SHGLaw who wrote (9237)	7/13/1999 4:51:00 PM
From: $Mogul	Read Replies (1) \| Respond to of 9343

Every Disney owned network ESPN, ABC, and every show ie. Local news, National news, Credits of shows have the Go.Com logo. Awareness is key here!! They have it to the hilt!

To: SHGLaw who wrote (9237)	7/13/1999 5:01:00 PM
From: robbie	Read Replies (1) \| Respond to of 9343

Some people don't see the big picture. Clueless Investor Mickey Mouse games Putting a value on Infoseek deal Lycos-USA Networks debacle left us clueless By Darren Chervitz, CBS MarketWatch Last Update: 5:40 PM ET Jul 12, 1999 Personal Finance News Join the discussion NEW YORK (CBS.MW) -- At first glance, it looked like good news for Infoseek investors. But shares lost 11 percent Monday after Disney said it would acquire the 58 percent of Infoseek it didn't already own for tracking stock in a new company. Disney (DIS: news, msgs) said it wants to complete the combination of the Internet portal (SEEK: news, msgs) with its own Go network. If the merger is approved, each Infoseek investor will get 1.15 shares of the new and improved company, to be named Go.com and to trade on the New York Stock Exchange as a tracking stock. Today on CBS MarketWatch Stocks recover but close down Intel profit falls short of target Brokerages surprise on the upside China.com IPO soars StockWatch: CDNow a classic 'takeunder?' More top stories... CBS MarketWatch Columns Updated: 7/13/99 4:40:04 PM ET "The new structure will integrate management, align interests and eliminate operational redundancies," the release said, pointing out that the merger would also create one of those highly valued Internet stocks that come in handy when pursuing acquisitions. Yet after some pre-market celebration, when Infoseek shares rose by more than 4 points at one point, investors began to wonder what the merger actually meant in dollar terms. After all, this wasn't a typical acquisition, in which Disney was giving Infoseek shareholders a certain amount of cash or its own stock, which has a clear value on Wall Street. Instead, non-Disney Infoseek shareholders were going to get 28 percent in a entirely new company, whose value was unclear and, in the end, going to be determined by the market. The result of the confusion: Infoseek shares fell 5 9/16 to 45 15/16. See related story. Aside from worrying about some difficult mathematics, investors also had Lycos on their mind, said Jim Preissler, Internet analyst at Prudential Securities. A similarly-structured merger between between Lycos (LCOS: news, msgs) and the Internet assets of broadcaster USA Networks (USAI: news, msgs) was torpedoed after Lycos investors thought they weren't getting a fair value for their stock. See original story on Lycos deal. "Investors maybe have jaded eyes toward these type of deals," Preissler said. $6.7 billion valuation Based on the terms of the deal, Disney and Infoseek executives thought the combined company should be worth about $6.7 billion, according to PaineWebber Internet analyst Jim Preissler. That was the implied market value of Go.com based on Infoseek's closing price on Friday. The calculation: $51.50 divided by the exchange ratio of 1.15 times the 150 million shares that Preissler said would be outstanding in the new company. At that valuation, the non-Disney Infoseek shareholders will hold about $1.9 billion worth of stock in the new company, about the same amount they held in Infoseek stock prior to Monday's trading action. The upshot: Investors who were holding Infoseek stock because they thought they would get a premium in a takeover attempt were disappointed. Yet Preissler and PaineWebber colleague Christopher Dixon think the deal was extremely fair for Infoseek investors. "Why would [Disney] pay a 20 percent premium for a company [it] already owns 42 percent of?" Dixon asked, calling the deal a "mouse hug" because of all the assets Disney is contributing to the new venture. In addition, shares in Infoseek had already risen about 41 percent in the weeks after Disney first announced it was in negotiations with Infoseek to expand its stake. Happy mice More importantly, said Dixon, the deal is going to pay off for Infoseek investors a year from now. He estimates that the combined company could have sales of $520 million for fiscal 2000, up from $350 million for this fiscal year. Applying a price-to-sales revenue multiple of 23 for the Internet operations and a multiple of 14 for the Disney catalog business, the new company should be worth $69 a share, implying a target price per Infoseek share of $80 ($69 times the 1.15 exchange ratio). "If you're in there for the long haul, you're as happy as you can be," Preissler said. But if you were counting on a short-term gain, you're probably just clueless.