Yep! Go2Net to Receive $300 Million
Investment From Paul G. Allen; Allen
Also Initiates Cash Tender Offer for 5
Million Shares of Go2Net at $90 per Share For Controlling
Interest in the Company
biz.yahoo.com
Allen Plans to Integrate and Offer Go2net Portal Services Over Cable
Systems
SEATTLE, March 15 /PRNewswire/ -- Go2Net (Nasdaq: GNET - news), a network of branded,technology- and community-driven Web sites, today announced a $300 million investment by Paul G.
Allen through the sale of convertible preferred stock to Vulcan Ventures Inc., Mr. Allen's investment organization. Today, Vulcan Ventures purchased approximately $165 million of convertible preferred
stock, with the remainder of the preferred stock to be purchased upon shareholder approval. As part of the transaction, Vulcan Ventures entered into agreements to purchase 1.4 million shares of common
stock from Go2Net's executive officers and Directors, and agreed to also commence a tender offer to purchase up to 3.6 million shares of Go2Net's outstanding common stock at $90 per share in cash.
Assuming that all the shares being tendered for are purchased and the remainder of the preferred stock is purchased by Vulcan, Allen will own more than 54% of Go2Net's outstanding shares. Go2Net
CEO Russell C. Horowitz and the company's existing management team will continue to manage the company and lead its strategic expansion.
''Go2Net's association with Paul Allen is significant for a number of reasons: It provides Go2Net the capital and strategic resources necessary to build the Go2Net brand, extend our acquisition strategy, and enhance our existing properties and infrastructure, while setting the stage for the Go2Net Network to become a primary platform for content delivery and value creation in the broadband
world,'' said Russell C. Horowitz, Go2Net Chief Executive Officer. ''Paul Allen's vision and commitment to the future of our industry are unmatched. We're excited about the prospect of having an
opportunity to provide Go2Net's premier content and services to certain Paul Allen assets, including one of the nation's largest and fastest-growing networks of cable systems.''
In addition to supporting the ongoing growth and development of the Go2Net Network, the agreement indicates that Go2Net will work with Allen's affiliated cable companies to provide those companies'
subscribers with access to Go2Net's portal services. Allen's cable assets, which include Charter Communications Inc. and Marcus Cable Company, currently comprise the nation's 7th largest cable
operation. He is also a significant shareholder of Denver-based High Speed Access Corporation (HSA), a leading provider of high speed Internet cable services.
''Comprehensive portal services such as Go2Net delivered directly to set top boxes will be a critical component in the future of cable,'' said Allen. ''I look forward to working with Go2Net to
develop these services for the customers of our cable systems, and to forging relationships between Go2Net and my cable holdings to further enhance the companies' existing offerings.''
One of the most significant cash investments involving the Internet sector to-date, Allen's investment enables Go2Net to greatly enhance the development of the Go2Net Network, currently focused on the categories of search, finance, ecommerce and games.
Additional Terms of the Agreement
Paul G. Allen agrees to purchase an aggregate of $300 million worth of a new series of convertible preferred stock of Go2Net, convertible into approximately 26% of Go2Net's common stock.
Approximately $165 million of convertible preferred stock was purchased today, with the remaining shares to be purchased upon shareholder approval. Pursuant to the agreement with the
company, Allen also agreed that Vulcan Ventures Inc., his investment organization, would commence a tender offer to purchase up to 3.6 million shares of common stock of the company at $90 per share in cash on or before Friday, March 19, 1999. Certain members of the company's management and Board of Directors have entered into agreements under which Allen will buy an aggregate of 1.4 million shares of Go2Net's common stock at $90 per share and have agreed to vote all of their Go2Net stock in favor of the transaction. Assuming that all of the shares being tendered for are purchased and the preferred stock sale is consummated, Allen will own approximately 54% of the outstanding shares of the company, assuming conversion of the preferred stock. Broadview International LLC was
the financial
advisor to Go2Net for this transaction and NationsBanc Montgomery Securities
represented Paul G.
Allen and Vulcan Ventures Inc.
About Go2Net, Inc.
Go2Net is a network of branded, technology- and community-driven Web sites focused on
the
following categories: personal finance, search, commerce, and games. The company also
develops
Web-related software. The Go2Net Network's properties include: Go2Net Personal (
go2net.com ), which provides users with a comprehensive Internet start page
offering
customizable news, discussion, and stock information, as well as direct access to Go2Net's
own
finance, search, free Web hosting, shopping and Java multiplayer game sites; Silicon
Investor (
siliconinvestor.com ), the Web's premier financial discussion site; StockSite (
stocksite.com ), which offers proprietary articles, portfolio tracking tools,
company
research and news relating to business and finance; MetaCrawler (
metacrawler.com ), a
metasearch service that combines various existing search/index guides into one service;
100hot (
100hot.com ), the Internet's premier category-by-category ranking index of
Web sites;
HyperMart ( hypermart.net ), the Web's leading provider of free business
hosting services;
WebMarket ( webmarket.com ), a one-stop comparison shopping service; and
PlaySite (
playsite.com ), the Web's premier Java-based multi-player games site. The
company's
Go2Net Labs division develops innovative technologies to enhance the features and
functionality of the
Go2Net sites and for licensing to other Internet companies.
About Paul G. Allen
Paul G. Allen owns and invests in a suite of companies exploring the potential of digital
communications. Allen's business strategy includes encouraging communications and
synergy between
his companies for mutual benefit. His primary companies include Asymetrix Learning
Systems
(Nasdaq: ASYM - news), Vulcan Ventures Inc. and Vulcan Northwest Inc., all of
Bellevue, Wash.,
and Interval Research Corp. of Palo Alto, Calif. Allen recently acquired limited
partnership interest of
Marcus Cable of Dallas and Charter Communications of St. Louis. Allen is owner of the
Portland Trail
Blazers NBA team and the NFL's Seattle Seahawks franchise, is a partner in the
entertainment studio
DreamWorks SKG and holds investments in more than 50 new media companies which
further his
vision of a Wired World. Allen co-founded Microsoft Corp. with Bill Gates in 1975 and
served as the
company's executive vice president of research and new product development, the
company's senior
technology post, until 1983. Allen gives back to the community through the six Allen
Charitable
Foundations, which support arts, medical, forest protection and other charitable needs in
the Pacific
Northwest, and is the founder of Experience Music Project in Seattle.
This announcement contains forward-looking statements that involve risks and
uncertainties, including
those relating to the company's ability to grow its user and advertiser base. Actual results
may differ
materially from the results predicted and reported results should not be considered as an
indication of
future performance. The potential risks and uncertainties include, among others, the
company's limited
operating history, the competitive environment in which the company competes, the early
stage of the
Web as an advertising and electronic commerce medium, the company's dependence on
advertising
and sponsorship revenues, the company's dependence on strategic relationships to drive
traffic to its
Web sites, consumer acceptance of the company's new products and services, the
company's ability to
develop and integrate new technologies and services into its existing services, and the
increased use of
the Web for commerce. More information about the potential factors that could affect the
company's
business and financial results is included in the company's Annual Report on Form 10-K
for the year
ended September 30, 1998 and Quarterly Report on Form 10-Q for the quarter ended
December 31,
1998, which are on file with the Securities and Exchange Commission.
CONTACT: Mark S. Peterson of Go2Net, Inc., 206-447-1595, or mark@go2net.com; or
Susan
Pierson Brown, 425-453-1940, or susanp@vnw.com, for Paul G. Allen/ Vulcan Ventures
Inc.
SOURCE: Go2Net, Inc.
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