By Joey Gardiner, 11 May 1999 14:32
NEWS Lycos was this morning unavailable to comment on reports that the proposed merger with USA Networks had fallen through. The Wall Street Journal reported that the merger is in doubt, citing rumours that USA Networks may pull out of the deal. Lycos stocks rose sharply yesterday on the news, with many Lycos shareholders feeling the bid undervalued the portal company. Lycos shares reached $105.25 on Nasdaq, up $15.75 on the day. The merger has been controversial since it was announced in February, causing one of Lycos' main shareholders, David Wetherell, to resign from the Lycos board after a bad stock reaction. Analysts, however, still see the merger as a good idea. Nick Jones, commerce analyst at Jupiter Communications, said the synergy between USA Networks and Lycos is evident: "There are benefits to both sides from the deal. Lycos is a 'sticky' portal, attracting and keeping users, and USA Networks brings Barry Diller's massive experience of home shopping."
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