Three-way Lycos merger creates online giant

The online merger frenzy continues with the announcement that Lycos is involved in a three-way merger with USA Networks and Ticketmaster Online-Citysearch, creating an e-commerce giant leveraging both the Internet and cable television.

Under the terms of the complex deal, Lycos will merge with Ticketmaster Online-Citysearch, in which USA Networks holds a controlling stake. USA Networks will also add its other e-commerce assets, including the Home Shopping Network (HSN) cable television unit, into the combined company which will be called USA/Lycos Interactive Networks, the companies said in a statement.

Financial details of the agreement were not immediately available. The merger is expected to be completed in the second quarter of this year.

Barry Diller, chairman and CEO of USA Networks, will become the chairman of USA/Lycos, while Robert Davis, president and CEO of Lycos, will become president and CEO of the new company.

"We've created the framework for becoming the largest e-commerce entity," Davis said during a press conference.

On a historical pro forma basis, USA/Lycos will have combined revenues of more than $US1.5 billion, the companies said. On its first day of operation, it will have the capacity to reach 70 million television homes and approximately 30 million Internet users through its Web sites, according to the statement.

USA Networks will hold a majority 61.5 per cent stake in the new company, with Lycos shareholders owning a 30 per cent stake, and Ticketmaster Online shareholders other than USA Networks holding the remaining 8.5 per cent, the statement said.

The announcement is the latest in the Internet portal merger frenzy that kicked off last June when the Walt Disney bought a 43 per cent stake in Infoseek for $70 million by selling its interest in Web developer Starwave to the portal.

Last month, @Home announced its intention to purchase Excite for an all-stock transaction valued at $US6.7 billion. The deal followed a surprise announcement in November that America Online (AOL) would buy Netscape Communications.

Earlier this month, speculation arose that NBC might take a 35 per cent stake in Lycos and merge NBC's Snap portal with Lycos. Other names circulating as potential Lycos suitors included Time Warner and Bertelsmann AG.

Lycos' Davis, meanwhile, has publicly maintained that the company would remain independent.

Lycos' stock price has benefited from all the rumours, which have helped raise the company's market capitalisation to over $US6 billion.

The deal must still be approved by regulators and Lycos shareholders, but Lycos' largest shareholder, CMG Information Services, which owns about 20 per cent of Lycos, has said it supports the deal, according to the statement.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?