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To: OtherChap who wrote (8241)	3/10/1998 8:21:00 PM
From: Glenn D. Rudolph	Respond to of 27307

Ticketmaster web business seen as plus for Diller Reuters Story - March 10, 1998 18:57 %RET %US %MRG %LEI %PUB %APL USAI TKTM V%REUTER P%RTR By Sue Zeidler LOS ANGELES, March 10 (Reuters) - USA Networks Inc's long-sought acquisition of Ticketmaster Group Inc should give Barry Diller's media company a strategic toehold in the growing business of online ticket sales. "Ticketmaster is one of a few companies that have shown a profitable use of the Internet. When combined with USA Network's assets, Ticketmaster's transaction capabilities could provide real leverage," said Mark Manson of DLJ. Ticketmaster's shares rose 1-7/16 to 27-13/16 and USA Networks' shares fell 1-1/2 to 51-1/4 at midday Tuesday in trading on the Nasdaq. Nearly five months after USA Networks, owner of USA Network and the Home Shopping Network, first bid for the part of Ticketmaster it did not own, it increased its stock offer by 11 percent. Ticketmaster shareholders will now receive 0.563 USA Networks share per each of their Ticketmaster shares. Based on USA Network's stock Tuesday, Ticketmaster stockholders would get $28.85 worth of USA stock for each share they hold, or about $390 million, up from $350 million initally offered. Ticketmaster, the world's leading computerized ticketing service, sold 70.2 million tickets in fiscal 1998, up 17 percent from 60.0 million tickets in fiscal 1997. Los Angeles-based Ticketmaster was founded in the late 1970s and expanded into a powerhouse by the late 1980s, further solidifying its position through acquisitions, including the 1991 buyout of troubled rival Ticketron. Last month, the company reported fiscal fourth-quarter revenues rose 36 percent to $93.2 million. "The most important assets USA Network is gaining through the Ticketmaster acquisition are its two transaction-processing engines, including its hard copy transfer franchise and the other potentially more important one, which handles transactions through the Internet," Manson said. Ticketmaster sold nearly 400,000 tickets online worth over $16.7 million in the fourth quarter ended January 31, 1998, accounting for about 2.5 percent of its total business. It said 22 percent of tickets sold online represent new business to Ticketmaster. "It's clearly worked out very well and in the last quarter, our online business turned profitable," Fred Rosen, president and chief executive officer of Ticketmaster, told Reuters. Just two weeks ago, industry sources had speculated that Rosen, who is credited with spearheading Ticketmaster's success, may launch a bid of his own. Rosen said Tuesday the latest bid by Diller represented a fair value and plans to assist with the transition. "I've agreed to finishing my contract through the end of the year," he said, but would not elaborate on future plans. "Rosen and Diller are both strong personalities, but Rosen's the one who built Ticketmaster and to take this to the next level, they'll have to cooperate," an industry source said. Diller, whose company is comprised of the assets of HSN, broadcast and television assets, some of which previously were owned by Universal Studios, has long viewed Ticketmaster's third-party transaction business as complementary to HSN. "The companies' synergies give them significant combined capacity in the realm of cross-promotion," one analyst said. "They can sell baseball tickets through Ticketmaster and promote Mets clothing on (the) Home Shopping" Network, the analyst noted. Both USA Networks and Ticketmaster operate call centers to handle customer orders. Rosen said Ticketmaster, which employs about 5,200 full- and part-time workers, should continue to operate as it has been run. "USA and Ticketmaster (call centers) are not compatible," he said. "Nobody's closing down phone rooms. In fact, we're opening more."