Wednesday, December 30, 1998

"Money is like muck, not good except it be spread." -- Francis Bacon

Latest Market Numbers

Interlinq Going Private

Don't tell Interlinq Software (Nasdaq: INLQ) that this, the week after Christmas, is supposed to be a slow, uneventful week as the year draws to a close. There may be companies, such as Mattel Inc. (NYSE: MAT), that are taking two weeks off for the holidays. Late yesterday, however, Bellevue, Washington-based financial services software maker Interlinq announced it would undergo a leveraged capitalization. In plain English, it is offering to buy back all but 1.25 million of its shares for $9 1/4 a pop in cash -- that's a 19% premium over its closing price yesterday of $7 3/4 -- and it plans to take the company private.

As part of the leveraged capitalization, Interlinq has agreed to be acquired by one of its shareholders, San Francisco-based investment firm W.R. Hambrecht + Co., which owns 109,292 Interlinq shares, or about 2% of the company, according to SEC filings. A W.R. Hambrecht affiliate, Ironstone Group Inc., owns another 263,200 shares, making for a combined stake of 372,492 shares, or just over 7%. W.R. Hambrecht + Co. is the investment vehicle of William R. Hambrecht, co-founder and former chairman of investment bank Hambrecht & Quist Group (NYSE: HQ). Interlinq first disclosed it was in talks with W.R. Hambrecht early this month.

Interlinq shareholders may choose to hold on to their shares, as long as the total doesn't exceed 1.25 million. But the company might do a reverse stock split after being bought by W.R. Hambrecht to cut down on the number of shareholders to less than 300 and facilitate taking the firm private. At last report, the company had 2,312 shareholders and about 5.12 million shares outstanding. Interlinq expects that merger-related costs will cut fiscal second quarter earnings by roughly $0.06 a share.

News to Go

Athletic footwear and apparel retailer The Finish Line (NYSE: FINL) reported an 86% drop in fiscal third quarter per share earnings to $0.02 from $0.14 last year. The company issued an earnings warning early this month when it reported a 5% decline in Q3 same-store sales. The $0.02 was at the bottom of the company's then estimated range of $0.02 to $0.04. It blamed the shortfall on increased costs, flat shoe sales, and a 15% decrease in apparel sales, which are expected to persist in Q4.

Computer graphics peripherals maker CalComp Technology (Nasdaq: CLCP) said it is considering "strategic alternatives," including selling some or all of its businesses, shutting down its operations, and if all else fails, filing for Chapter 11 bankruptcy. The decision comes after the company's majority shareholder, aerospace and defense giant Lockheed Martin (NYSE: LMT), said it would not increase CalComp's existing credit capacity beyond the $43 million now available to fund its continuing operations.

Internet search engine company Inktomi (Nasdaq: INKT) plans a 2-for-1 stock split payable January 27.

Information technology outsourcing services company Sykes Enterprises (Nasdaq: SYKE) announced the acquisition of two privately held call center providers, TAS GmbH Nord Telemarketing und Vertriebsberatung of Germany and Oracle Service Networks Corp. of Canada, for around 2.06 million shares. The deals are expected to have no effect on 1998 EPS, before charges.

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Yi-Hsin Chang (TMF Puck), Writer
Jennifer Silber (TMF Amused), Editor