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

To: Rande Is who wrote (25863)	5/15/2000 8:24:00 AM
From: Rande Is	Read Replies (2) \| Respond to of 57584

WSJ reported that the two are in talks that would "likely lead to Terra Networks buying LCOS for $10 billion" in an "all stock deal". With LCOS current market cap at just under 6 billion. . .that would account for the premium reported. Rande Is

To: Rande Is who wrote (25863)	5/15/2000 8:48:00 AM
From: david james	Read Replies (1) \| Respond to of 57584

Analyst Jesus Gomez? cnetinvestor.com Terra Seeking to Buy Lycos for $10 Billion in Stock (Update2) 5/15/00 5:10:00 AM Source: Bloomberg News Madrid, May 15 (Bloomberg) -- Terra Networks SA, Europe's second-biggest Internet service provider, is in talks to buy Lycos Inc. for at least $10 billion in stock to enter the U.S. market, the Wall Street Journal Interactive reported, citing people familiar with the talks. An offer at that price would value Lycos at $91 per share, almost 70 percent more than at the close of trading Friday. The offer is almost two thirds of Terra's current market value of 16.5 billion euros. Lycos shares in Germany rose as much as 4 euros, or 6.2 percent to 68.5 euros, while Terra fell 0.15 euro to 64.75. ''If the deal goes ahead I would expect Terra to pay a high premium,'' said Jesus Gomez, an analyst at BSCH Bolsa SA who recommends buying Terra shares. ''Valuations are very complicated because with these companies you are buying future value.'' Taking over Lycos would give Terra better access to the more than 30 million Hispanics in the U.S. and help it gain a presence in Europe and Asia, where Lycos is active. Lycos would get Spanish content and Terra's muscle in Latin America, where it is one of the region's biggest Internet companies. Bertelsmann AG, Europe's biggest media company and Lycos's European partner, is considering taking a stake in the combined company, FT.com, the Financial Times's web page, reported today. Bertelsmann and Telefonica SA, owner of Terra, declined to comment. Terra said Friday it was in talks with Lycos, though ''no definitive agreement has been reached that merits being made public, and there's no assurance such will happen.'' 'Leading Candidate' ''Terra is seriously studying entering the U.S. market through acquisitions and Lycos would be the leading candidate,'' said Madrid brokerage Ibersecurities in a note to investors. ''The success depends on the price set and would be done through a share swap.'' Terra shares rose 10 percent on Thursday and Friday, while Lycos U.S. shares rose more than 19 percent in the same period. While Terra's revenue of 37 million euros ($33.5 million) in the quarter ended March 31 is less than half the revenue Lycos reported in its second quarter ended Jan. 31, Terra's market value of 18 billion euros (US$16.2 billion) is almost three times that of the U.S. company. Terra had almost 2 million subscribers at the end of the first quarter. About half its users are in Spain. Most of the rest are in Latin America, where Waltham, Massachusetts-based Lycos has been trying to expand its business. Lazard Brothers & Co. is advising Terra and Credit Suisse First Boston is advising Lycos, the FT.com reported.

To: Rande Is who wrote (25863)	5/15/2000 9:27:00 AM
From: J D B	Read Replies (1) \| Respond to of 57584

Lycos, Spain's Terra Networks Discuss Merger To Form Global Internet Portal Dow Jones Online News, Monday, May 15, 2000 at 01:23 (Published on Sunday, May 14, 2000 at 22:22) NEW YORK -(Dow Jones)- Spain's Terra Networks SA is in serious discussions to acquire Lycos Inc. for at least $10 billion in stock, though there is a significant chance the two sides won't reach a deal, The Wall Street Journal reported Monday, citing people familiar with the matter. If the two sides do come to terms on a deal, it would create a global Internet portal. However, Terra (TRRA) and Lycos (LCOS) could simply form an Internet alliance, people familiar with the situation warned. Indeed, initial discussions between the two sides had centered on an alliance but then progressed to include acquisition talks, the Journal reported. Exact terms couldn't be learned, but under the scenario being discussed, Terra, the Internet unit of Telefonica SA, would use its American depositary shares to acquire Lycos in a stock-swap deal, offering more than 1.5 shares of Terra for each share of Lycos. That would value Lycos at more than $90 a share, these people said. Germany's Bertelsmann AG, which has a joint venture with Lycos, might also play a role in the combined entity, the Journal reported. Terra confirmed Friday that it was in talks with Lycos but said it has yet to reach any "definitive agreement which deserves to be made public," the Journal report said. The discussions come in the wake of an ill-fated plan by Telefonica, the big Spanish telecommunications company, to merge with KPN NV of the Netherlands, in what would have been a $60 billion deal. Ever since then, Telefonica Chairman Juan Villalonga's job has been up in the air and he has been under intense pressure. A Terra-Lycos deal would strengthen Villalonga's position since he also serves as chairman of Terra. Copyright (c) 2000 Dow Jones & Company, Inc. All Rights Reserved. Companies or Securities discussed in this article: Symbol Name DTB:BRT NYSE:TEF Telefonica S A NASDAQ:TRRA Terra Networks, S.A. NASDAQ:LCOS Lycos, Inc.