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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: H James Morris who wrote (12580)	8/4/1998 9:46:00 PM
From: Glenn D. Rudolph	Read Replies (1) \| Respond to of 164684

Amazon.com to buy two firms for $280 million in stock Reuters Story - August 04, 1998 21:11 %BUS %US %ENT %MRG %NEWS CMGI LCOS V%REUTER P%RTR (Adds details, comments, analysis) By Martin Wolk SEATTLE, Aug 4 (Reuters) - In an effort to bolster its position as the leading online retailer, Amazon.com Inc. said Tuesday it agreed to acquire two Internet companies in separate stock swaps worth a total of $280 million. The Seattle-based company said it will issue about $180 million in stock to acquire Junglee Corp., a provider of database technology in Sunnyvale, Calif., and about $100 million in stock for PlanetAll, a personal information service with 1.5 million subscribers based in Cambridge, Mass. Amazon.com stock added $1.625 to $109.875 on Nasdaq in a session when most technology stocks suffered heavy losses. Chairman Jeff Bezos said both acquisitions were aimed at enriching the the online retail experience for its customers. "What we're talking about is somewhat broader than books or music," Bezos said in an interview. "What we want to be is the leading e-commerce destination." He said the PlanetAll acquisition would help Amazon.com offer new services to its customers, such as enhanced gift giving. PlanetAll offers free e-mail reminders of birthdays and other occasions, which already are being combined with suggestions to buy books or music from Amazon. The Junglee acquisition brings to Amazon a "brilliant" group of people who have developed a database technology that can be used to help consumers filter the vast number of products and services offered on the Web, Bezos said. Together the two acquisitions will add about 100 employees to Amazon.com's total work force of 1,130, with PlanetAll operated as a wholly owned subsidiary in Cambridge. Jae Kim of Paul Kagan Associates said the acquisitions would help Amazon.com strengthen its customer service and brand loyalty, which could be crucial to the company's ability to turn a profit eventually. "The only brand loyalty people have on the Internet is to their wallet," he said. "In the future the ability to build communities with value-added services ... might be the key to higher margins." While Amazon.com is expected to expand beyond its current product offerings of books and music, Bezos said, the company has no plans to offer electronic mail, search or news services that would make it a so-called Internet portal, providing a wide array of Web services at a single site. "The portal business is a great business, but it's not our business," he said. Amazon.com lost $21 million on sales of $116 million in the latest quarter, although much of the loss was due to three smaller acquisitions announced in April. In the latest acquisitions, Amazon will issue a total of 2.4 million shares, diluting its outstanding shares by about 6 percent, Bezos said. The Junglee acquisition will be accounted for under the purchase method of accounting, with the per-share impact yet to be determined, Chief Financial Officer Joy Covey said. Warren Adams, a Harvard Business School graduate who founded PlanetAll two years ago, said his 40 employee-shareholders were "thrilled" by the deal, especially since the company will retain its brand name and East Coast headquarters. Among the financial backers of PlanetAll are CMG Information Services Inc., Lycos Inc. and Arts Alliance of Britain. Both deals are expected to close by the end of September, Amazon.com said. AMZN.O> (-Seattle bureau 206-386-4848,marty.wolkreuters.com)