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Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: Ron Dior who wrote (8687)	4/26/1999 5:37:00 PM
From: Educator	Read Replies (1) \| Respond to of 29970

AOL-Comcast alliance Ron- I always figured AOL would not be left in the cold. I have been waiting for AOL to do something bold like this. It wouldn't surprise me in the least. The consensus though is that AT&T's pockets are too big, and Armstrong wants UMG in the worst way. He will pay what it takes to consummate a deal. Time will tell on this one. I did see that AOL jumped nicely. Was this surge more in anticipation of earnings rather than a cable deal? I, too, saw the TJ interview. It was mediocre at best. I wasn't particularly impressed with T.J.'s answers. Tom gets a "C" in my grade book. He was not very smooth in his replies. The words did not flow easily from his mouth. Those humungous (sp?), white teeth got in the way! I agree that the questions were pointed, but maybe more because CNBC attempted to expose ATHM/Broadband's negative aspects for investors. I don't fault them for a "buyer beware" position. I also noticed that ATHM lost some of its intra-day gains following the interview. This was maybe a coincidence. What would happen to ATHM if AOL and Comcast orchestrated a UMG deal? Comments? Ed

To: Ron Dior who wrote (8687)	4/26/1999 6:55:00 PM
From: Neal davidson	Read Replies (1) \| Respond to of 29970

Ron...while cash is king, if AOL/Comcast offered a high enough premium over AT&T's bid, the advantage of cash would be eliminated. Additionally, many investors prefer stock deals, because they are non-taxable events. In other words, when a stock you own is bought, and you get stock of the acquiring company, you do not have to pay tax. You simply keep your original basis and pay tax when (and if) you sell the stock of the acquiring company. A perfect example is XCIT shareholders, who will pay no tax when they get ATHM shares. On the other hand, when your stock is bought for cash, then that IS a taxable event, and you have to pay capital gains taxes. If a Media One shareholder is holding onto huge non-realized gains, that shareholder may prefer stock to cash. (In fact, not having to pay capital gains tax can save 20% or more.) Having said that, when this is all over, I predict AT&T will own Media One for several reasons: (1) For AOL to get involved would be to acknowledge that their broadband plan is inadequate. (2) Even if they did get involved, it would only give them access to Comcast and Media One homes. That is not the nationwide coverage they seek. (3) The deal would be dilutive, and their shareholders would not take that very well. (Their stock would go down a lot more that AT&T did after the announcement.)

To: Ron Dior who wrote (8687)	4/26/1999 7:09:00 PM
From: lml	Read Replies (1) \| Respond to of 29970

A CMCSA bid with AOL makes the most sense. However, the issue to weigh with such a bid is the price is CMCSA willing to pay to preempt T's takeover of UMG. What victory would CMSCA have if it ultimately had to relinquish control to AOL? On the other side of the coin, how will acquisition of UMG's plant fit with AOL's overall strategy? Does AOL really want to be the owner of HFC pipes? Or is just interested in the direct ISP capabilities the UMG pipes offer? Direct AOL access over HFC would also serve AOL well in any future negotiation it may have with T. T would be interested in being the preferred telephony over cable provider & AOL would still wish to provide direct AOL access over T's pipes to compete with ATHM. RD: You raise a good point on the merits of a part-cash offer. It would be interesting to see the effect of an offering involving AOL stock upon its stock valuation.