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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: PCSS who wrote (44052)	1/19/1999 3:00:00 PM
From: Elwood P. Dowd	Read Replies (1) \| Respond to of 97611

Faber Report from CNBC CNBC's FABER REPORT:Compaq Said To Be Close To Internet Deal The following report was aired Tuesday on CNBC-TV by CNBC reporter David Faber: "If you're looking for the next Internet-related deal, look no further than Compaq Computer. That is the word I'm getting from people close to the personal computer maker, but details of what Compaq's move will be remain unclear. Now the company, as companies often do in this case, declines all comment. At present, Compaq's pure Internet businesses are its search engine service Alta Vista, which came along in its acquisition of Digital Equipment, and its very recent deal as well to acquire Internet commerce site Shopping.com, also obviously a pure Internet business. But people close to Compaq tell me to expect more, as Compaq moves to become a major Internet-focused company. In fact, I am told that Compaq hoped to announce a significant transaction today as part of this strategy, but the announcement has been delayed. What will that deal be? It is expected to be either an acquisition or partnership under which Compaq secures content and perhaps distribution as well for its search engine. Now, Compaq already has a well-known and highly-regarded search engine as we said, called Alta Vista. It also has the platform for an e-commerce business with Shopping.com, but it does still lack the content that might also draw users to its offerings. I have been unable to determine with whom Compaq's talks are taking place, but rumors range from a deal with the likes of a media company that can offer content and may have a number of Web sites up and running to another Internet company that might be able to offer Compaq distribution for its Alta Vista and Shopping.com services. Whatever move Compaq makes appears to be part of a plan by the company to create an Internet business of which it could then spin off 20% or so to the public. Given the astronomical multiples that public companies in this business garner, analysts do believe Compaq could create a great deal of value with some sort of spinoff. Of course, if you have heard that before it's because it has been rumored in part for months and Compaq's stock price has moved up at times on rumors of an Alta Vista spinoff. As for that other Internet deal today, you might have expected shares of Yahoo! to decline. This is, of course, fallout I'm talking about from At Home and Excite getting together. The combination of those two, especially when high-speed access starts to proliferate, is thought to be a true competitor for the leading Internet company, Yahoo, though that doesn't seem to be affecting its stock price. As for Intuit, well they might be up more. If the company called me back to tell me exactly what the terms were of a deal that was announced over a year ago, in which they helped out then-struggling Excite. They bought about 10% of the shares at a very big discount to the current price. It could amount to as much as about 6 million shares."