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

To: Don Pueblo who wrote (13)	1/26/1999 3:37:00 PM
From: Sir Auric Goldfinger	Read Replies (1) \| Respond to of 31

A partner for JTFX: AltaVista or MSFT from today's WSJ: "Compaq Plans IPO and Spinoff Of Shares of Its AltaVista Unit. An INTERACTIVE JOURNAL News Roundup Compaq Computer Corp., hoping to cash in on the stock market's love affair with Internet companies, unveiled plans for an initial public offering and spinoff of shares of its AltaVista Search Services. The plans include a new management team for the Palo Alto, Calif., unit that includes the naming of Compaq Senior Vice President Rod W. Schrock, the highly regarded head of its Consumer PC Products Group, as chief executive officer of the new entity. As a publicly traded company, AltaVista (www.altavista.com) could be valued at $2 billion, estimated Piper Jaffray Inc. analyst Ashok Kumar. Compaq, the world's largest personal-computer maker has scheduled a Tuesday news conference in New York with Mr. Schrock and Eckhard Pfeiffer, Compaq's chief executive, on the service's future. A spokesman declined to comment on the timing of the spinoff and IPO. Shares of Compaq climbed $2.875 to $49.5625 on the New York Stock Exchange Tuesday. "By establishing AltaVista as a separate company, it can better focus on providing the best user experience on the Internet, from search, to commerce, to communication and community," said Mr. Pfeiffer, in a statement released early on Tuesday. Analysts say the company last year rebuffed several offers to buy the Internet search service, believing it could remake the site into a highly valued Web "portal," complete with services such as shopping and news, similar to Yahoo! Inc. and Excite Inc. Indeed, it recently agreed to pay $220 million for Shopping.com, a Corona del Mar, Calif., company that runs an electronic-commerce service. Compaq also has been angling to find content and distribution partners but so far to no avail. Stephen Mucchetti, chief operating officer at e-commerce consultants Scient Corp., says that creating a publicly traded stock for AltaVista could help it by giving it a currency for making acquisitions, and, just as important, independence. "With its freedom from a computer-products company, AltaVista may [reach deals] more easily with network providers and portals," he said. Insiders say company executives had been reluctant to spin off the business. But with the huge run-ups in valuations for Internet stocks, they decided the business needed to be separate to better compete with the consolidation now taking place among Internet-service companies. "Clearly, they need an approach to move AltaVista toward becoming a portal," said Mr. Kumar at Piper Jaffray. According to the latest results from researcher Media Metrix Inc., AltaVista ranks as the 12th-most-visited Web site. Still, a spinoff would be an ironic footnote to Compaq's $9 billion purchase of Digital Equipment last year. Digital executives had once scheduled an initial public offering for AltaVista, but canceled the offering, believing AltaVista's name recognition helped the company sell its computers and services. Compaq's search for partners has already borne fruit. The company said Tuesday that it has reached an agreement with Microsoft Corp. to offer AltaVista users an AltaVista-branded version of Microsoft's Hotmail e-mail service as well as future instant-messaging technology. Microsoft has also agreed to make AltaVista the primary search engine on its Microsoft Network, and to work with Compaq "on a range of other future Web-based communications and community building services." As a result of the deal, Inktomi Corp., of San Mateo, Calif., said Microsoft is phasing out its search technology as the primary search engine on the Microsoft Network in order to replace it with AltaVista. Investors reacted harshly to that news, driving Inktomi's shares down $24.75, or 17%, to $123.50 on the Nasdaq Stock Market Tuesday. Officials from Microsoft and Inktomi said they looked forward to finding ways to work together in the future. "While we are disappointed with events today, we hope that Inktomi and Microsoft will find new ways to work together across our product lines," said David Peterschmidt, Inktomi's president and chief executive officer.