World Online-Tiscali merger process under way

NEWS Free ISPs World Online and Tiscali have set in motion the completion of their merger. The Dutch and Italian ISPs today ordered a suspension of share trading on their respective stock exchanges as part of the run-up to a merger announcement this afternoon. However, the news is likely to get a mixed reception as analysts have dismissed the merger as being more likely to unleash a 'glut of paper money' than introduce real consolidation. Miles Saltiel, director of technology research for West LB Panmure said analysts will view the merger as confirmation of the underlying weakness of the free ISPs' business models. He said: "The move does not take capacity out of the market."