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Technology Stocks : Loudeye Technologies, Inc. (LOUD) -- Ignore unavailable to you. Want to Upgrade?

To: steve walsh who wrote (20)	9/29/2001 8:37:59 AM
From: Glenn Petersen	Respond to of 83

Loudeye buys CMGI's Activate for $4 million SEATTLE, Sept 25 (Reuters) - Loudeye Technologies Inc. <LOUD.O> said on Tuesday it has bought Activate.net Corp. from CMGI Inc. <CMGI.O> for $4 million, expanding the digital music and video services company into the corporate market. Seattle-based Loudeye said Activate, which offers live and on-demand Internet broadcasting for businesses including Microsoft Corp. <MSFT.O> and Compaq Computer Corp. <CPQ.N>, would help it tap the fast-growing market for streaming media among corporate customers. "This acquisition will significantly strengthen and diversify Loudeye's revenue mix and increase future earnings potential by accessing existing corporate budgets for training, product marketing, sales support, corporate communications, customer service, public relations and travel," Loudeye Chief Executive John Baker said in a statement. The addition of Activate's infrastructure would also boost Loudeye's existing businesses, which have focused on areas like hosting music samples for online music retailers and Internet radio, the company said. "We looked at the enterprise streaming market as a logical market for us to go after and it's a good strategic fit for our existing streaming media business," Loudeye spokesman John Shaw said in an interview. 'BUYER'S MARKET' Loudeye said it expected Activate's revenues to grow to $12 million in 2002 from an expected $8 million to $9 million this year. That could instantly double Loudeye's revenues, which came in at $2.7 million for its second quarter ended June 30. The company lost a net $7.3 million, or 18 cents a share. Shaw declined to say what the impact on Loudeye's earnings would be, but said that Activate, which is also based in Seattle and was owned by beleaguered Internet company operator CMGI, was seen turning cash-flow positive by the end of 2002. Loudeye would record a special charge of $2 million to $2.5 million in the third quarter. Most of that would be non-cash, the company said. Shares in Loudeye closed down 2 cents, or 3.8 percent, at 50 cents in Nasdaq trading before the deal was announced. The stock is off a year-high of $9. Under the deal, which closed Tuesday, Loudeye has paid $1 million in cash to CMGI and will pay another $3 million in cash or stock in one year, Shaw said. "This is a buyer's market. It's typically cheaper to acquire revenues, market share and technology in the current market," Shaw said. The purchase will 85 employees to Loudeye's existing payroll of about 190 workers, Shaw said. 20:03 09-25-01