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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: Manny who wrote (39356)	12/6/1999 6:52:00 PM
From: Jesse James	Read Replies (2) \| Respond to of 108040

Regarding NTPL: (from sshia 11/29 interview of Gene Zaino, CEO of Netplex) sshia: Hold on. You mean Opus 360 tried to buy out your new business, Techcellence? Gene: Yes. sshia: Well, this tells us this sector must be hot. Tell us why you did not sell and more about the offer. Gene: This is not the time for Netplex to sell Techcellence, certainly not at the value we've been at. And I being a very large shareholder am not going to unload my stock, especially to a lot of these companies with over-valued stock. I can't say how much the offer was because we didn't get into negotiations. But, I know many companies would love to buy us. They'd buy us at three times our stock price and that's still not worth it. Our market capitalization is a little over two times annual revenues, while others in this space are ten times. and lastly: sshia: We've focused on Techcellence and its big growth potential. How does growth look for 2000 and beyond for Netplex itself, your core $50 million a year business? Gene: The e-Solutions industry is growing at more than 35% per year. We think we can do that and even better, especially since we hired Pamela Fredette as President in May. She was previously the president of Computer Horizons. When she joined Computer Horizons, the stock was $8. When she left six years later, the stock was about $250, split adjusted. Pam was responsible for building an entire computer solutions group, and she took it from $30 million to well over $200 million. With Pam's help, we expect to further penetrate the financial services market in the New York area, which is where Pam is from, and leverage that end of our business. So, right now we are focused on the retail community, the telecommunications industry, and we will move into the financial services market early next year. sshia: So Pamela is a great asset to Netplex. Gene: Yes, in many different ways. She's got a lot of contacts with large companies in the NY area to get more business. I gave Pam the keys to the consulting business and told her just go do it. That has freed me up to spend more time working with the investment community. Our investor relations specialist, Joe Zappulla of Wall Street Investor Relations, has introduced me to a couple institutions. Riggs Bank is in our stock. Wall Street Associates owns shares, too. And those came from Joe. He put me in front of institutions. I talked to a buy-side analysts, and they tend to buy. So, we've been pretty successful with that and we're going to continue. sshia: What is your major focus now that Pam is taking over the responsibility for Netplex, the core business? Gene: My plans are to simplify Netplex's capital structure and ensure the financial strength and stability of both our e-Solutions Business and the Techcellence business. sshia: I am sorry to interrupt. Could that mean an IPO? Gene: Well, we'll be reviewing all of our financing options. It depends on the capital constraints and some partnerships we may be able to put together. We believe we may be able to get some strategic partnerships with Techcellence that would help fund that as well as provide us some opportunities. For instance, there are some internet banks that are starting up and there are also some brokerage firms who would have a big interest in getting access to our Contractor's Resources consulting base. CR's members are high income earners who like to play the stock market. They need retirement plans, banking transactions, mortgages, etc. So, if we were to partner with some institutions who would want access to our contractors' space, that could be another form of financing that entity. We're looking at all options and we will do whatever we need to do, obviously, to maximize Netplex shareholder value. That is our #1 concern. sshia: Will the current shareholders of Netplex have first chance at the IPO? Gene: I can assure you we will pick the way that offers NTPL shareholders the best opportunity. We could even do a split like AT&T did when they spun off Lucent Technologies. We could dividend out Techcellence to our shareholders. sshia: Thank you very much for enlightening us on Netplex. It looks like you have a great core business and a subsidiary with very exciting growth possibilities. Do you have anything to add? Gene: You're very welcome. Let me just add that my goal is to unlock the value of the stock with Techcellence, which is kind of a higher risk, but a more sexy kind of business. Then, our consulting business, which is a solid $50 million consulting business, is growing nicely. With Pam on board, I think she will grow e-Solutions many times over.