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Thursday, April 1, 1999
"However big the Fool, there is always a bigger Fool to admire him." -- Nicolas Boileau-Despr�aux
Yahoo! Buys broadcast.com
Internet powerhouse Yahoo! (Nasdaq: YHOO) this morning announced it will acquire online streaming media company broadcast.com (Nasdaq: BCST) for $5.7 billion in stock. broadcast.com shareholders will take home 0.7722 of a Yahoo! share, worth about $130, for each broadcast.com share. That represents a 10% premium over broadcast.com's closing price yesterday of $118 3/16 and a 53% premium over broadcast.com's $85-a-share trading price before merger speculation surfaced in mid-March.
The deal, expected to be completed in the third quarter of this year, gives Yahoo! entry into Internet audio and video programming and broadcasting and further broadens the Internet portal's reach. Yahoo! CEO Tim Koogle said the acquisition is "a natural extension of our strategy to deliver the ultimate experience to Web users and a powerful advertising and distribution platform for both companies' content, advertising, and business services providers." In January, Yahoo! announced it would acquire community website GeoCities (Nasdaq: GCTY), which provides its members with free e-mail accounts and home pages along with page-building tools.
The companies will hold a press conference at noon Eastern time. To listen to the live call on the Internet, log on to http://webevents.broadcast.com/yahoo/mediabriefing0499/. An archive of the briefing will be available at the same Web address following the call.
News to Go
Oil exploration and production giant BP Amoco (NYSE: BPA) announced it will acquire Atlantic Richfield Co. (NYSE: ARC), or ARCO, in a stock swap valuing ARCO at $26.8 billion, a 26% premium, based on Friday's close before merger talks became public. Based on yesterday's close, the premium stood at 13%. Under the agreement, ARCO shareholders will receive 0.82 BP Amoco American Depositary Shares (ADS) for each ARCO share. The companies expect annual pre-tax synergies of $1 billion by 2001.
TV broadcaster CBS Corp. (NYSE: CBS) has agreed to buy TV syndication company King World Productions (NYSE: KWP) for $2.5 billion, or $33 a share, in CBS stock. That represents an 8% premium over King World's closing price yesterday, but King World shares have shot up 25% since merger talks were first reported on March 17. King World shareholders will receive 0.81 of a CBS share for every King World share. King World's stable of programs include "The Oprah Winfrey Show," "Wheel of Fortune," and "Jeopardy!"
Drug and health care products maker Johnson & Johnson (NYSE: JNJ) announced that it has won marketing approval from the U.S. Food and Drug Administration for its Sporanox drug, its intravenous treatment for difficult-to-treat, potentially life-threatening fungal infections.
Computer systems maker Silicon Graphics (NYSE: SGI) warned it expects to report a fiscal third-quarter loss that is $0.20 to $0.25 a share greater than analysts' expectations, currently at $0.07 a share, on revenue in the "low to mid $600 million range."
Contact lenses direct marketer 1-800 CONTACTS (Nasdaq: CTAC) said it expects first-quarter revenues and earnings to exceed previous estimates due to increased Internet sales. For the quarter, the company is projecting about $2.5 million in Internet sales -- more than double the number for the preceding quarter -- and "breakeven or better" earnings.
Enterprise software developer Select Software Tools Ltd. (Nasdaq: SLCTY) said it's in "exclusive discussions" with medical, chemical, and pharmaceutical business software company Base Ten Systems (Nasdaq: BASEA) to explore a possible business combination.
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