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To: esecurities(tm) who wrote (3639)	11/2/1999 9:48:00 PM
From: SemiBull	Respond to of 4231

Mattel To Spin Off Genealogy.Com LOS ANGELES (Reuters) - Toymaker Mattel Inc., hoping to turn around its lackluster Learning Co. acquisition, said Tuesday it will spin off a lucrative genealogy Web site to tap into the numerous consumers and potential profits promised on the Net. With a host of media and high-tech partners backing the deal, Mattel will inject $37.5 million into the new, Fremont, Calif.-based company. called Genealogy.com. Partners include A&E Television Networks, Hearst Corp. and Weston Presidio Capital, among others. Its Web site was set up last year by Learning Co. unit, Broderbund, and has been a successful part of Learning Co., although Learning Co. overall has hurt Mattel's earnings. Late last month the maker of toys like Barbie Dolls and Hot Wheels, said Learning Co., which it acquired earlier this year for $3.5 billion, would have an unexpected loss of $105 million in the third quarter as opposed to a previously forecast profit of around $50 million. Mattel attributed the shortfall partly to its inability to book $60 million in licensing sales from a deal that fell through. In recent statements, Mattel Chief Executive Jill Barad repeated Mattel's commitment to using Learning Co. to help reposition it from a simply toy maker of toys to a provider of toys, software, computer games and online ventures. Mattel said Tuesday it will use Genealogy.com's software to help build a presence online. ``This is one of a number of these ventures we intend to undertake where we remain an equity partner in the venture,' Mattel spokesman Glenn Bozarth said. Mattel will retain a minority stake in Genealogy.com, but Bozarth declined to give details of the deal. He said Mattel would license rights to genealogy software to others, and it would develop and market software for possible future deals. Mattel had been working on Genealogy.com long before the Learning Co.'s problems surfaced, Bozarth said, noting Mattel struck a similar deal with a furniture site, goodhome.com. ``Working with these strong partners and benefiting from increased investment in the site we'll be able to leverage our assets to create greater value than we could on our own,' Bozarth said. ``On a long term basis this is going to create for us a presence on the Internet in various venues.' Broderbund's genealogy software division is profitable, but Genealogy.com Chief Executive Officer Robert Armstrong said the company will be ``devoting a lot of resources to areas that we see as important to future growth.' The company aims to maintain its profitability, he said, but did not discuss its level profitability. He added that an initial public offering is one option Genealogy.com is considering to help raise funds. The venture will continue to make Broderbund's Family Tree Maker and Family Archive compact discs, as well as the online presence at familytreemaker.com, genealogy.com and a subscriber only site at familytreemaker.com, the companies said. The subscription based site is a collection of databases, government records, landmark lists and how-to articles for genealogists. The subscriptions cost $9.95 a month or $99 a year, Armstrong said. Additional financial backers include Hearst Interactive Media, E Ink Corp., Exodus Communications Inc., Medscape Inc., Quokka Sports Inc., Talk City Inc. and Tavolo. (corrects) Mattel stock was up 1/2 at 14 at the close of New York Stock Exchange trading Tuesday.