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To: Jack Hartmann who wrote (18)	12/10/1999 5:42:00 PM
From: Glenn Petersen	Read Replies (1) \| Respond to of 66

Additional coverage: news.cnet.com El Sitio shares more than double in trading debut By Bloomberg News Special to CNET News.com December 10, 1999, 2:05 p.m. PT update BUENOS AIRES, Argentina--Shares of El Sitio, one of Latin America's biggest Internet companies, more than doubled in their first day of trading after the company raised $131.2 million in an initial stock sale. El Sitio shares climbed 17.31 to 33.31 in trading of 9.5 million shares. The stock soared as high as 40 after a starting price of 30.25, which was almost twice the IPO offer of $16. "Investors are very confident," said Oswaldo Sandoval of Explorador Capital in San Francisco. He said the El Sitio shares were at least 11 times oversubscribed by investors trying to buy shares before they begin trading. "I think there's enough demand to keep the price up, even if some initial investors start selling," he said. Buenos Aires-based El Sitio, which operates a network of Spanish and Portuguese-language Web sites targeting Latin America and United States, is the fourth online company serving the region to tap markets to fund expansion. Investors are betting the companies will benefit from booming demand for online services in Latin America, where the number of Internet users is expected to jump sevenfold by 2003. New York-based StarMedia Network, one of the first publicly traded online companies to target Spanish speakers, rose 6.75 to 37. That's more than double its May IPO price of 15 but far below its 52-week high of 70. Shares of competitor Terra Networks, the Internet unit of Spain's Telefonica, fell 0.75 to 47.63, although they have risen about fourfold since they went to market last month. Quepasa.com has slid to the neighborhood of its $12 IPO price since nearly doubling in its first day of trading in June; they company rose 1.5 to 12.88. The new Latin America-focused Internet companies face increasing competition from U.S.-based giants such as Microsoft, Yahoo and America Online. Last month, AOL began its service in Brazil, vowing to become that country's leading provider within a year. In October, Microsoft said it would join with Telefonos de Mexico, the biggest Mexican telephone company, to develop a Spanish-language Internet portal for the Americas. That means El Sitio, which has its strongest presence in Argentina, must expand quickly if it hopes to catch up to its competitors in countries such as Brazil, by far Latin America's largest market, analysts said. That country is already the scene of a turf war between the region's largest Internet provider, Universo Online, and the Latin American subsidiary of America Online. Last month, Universo, which has exclusive rights to many of the country's magazines, slashed prices to compete with AOL, which began flooding the country with free Internet access offers last month in a bid to win some 700,000 Brazilian customers. What's more, StarMedia and Terra Networks, with its Zaz Web site, have built strong footholds there. El Sitio, which was founded in 1997, will use the proceeds of the stock sale in part to expand its Web offerings around the region as part of its strategy to develop country-specific Internet content. The company also aims to broaden the market for its dial-up Internet access services. El Sitio's backers include Dallas-based buyout fund Hicks Muse Tate & Furst and Venezuelan media company Cisneros Group, which also is a partner in AOL Latin America. Copyright 1999, Bloomberg L.P. All Rights Reserved.