EARTHLINK, MINDSPRING ANNOUNCE MERGER DEAL.Byline: Dereck Andrade Staff Writer Internet service providers Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. EarthLink Network Inc. and MindSpring Enterprises Inc. announced Thursday the two ISPs would merge in a stock swap A stock swap also known as a share swap or equity swap is a business takeover in which the acquiring company uses its own stock to pay for the acquired company. deal that would create the nation's second-largest ISP (1) See in-system programmable. (2) (Internet Service Provider) An organization that provides access to the Internet. Connection to the user is provided via dial-up, ISDN, cable, DSL and T1/T3 lines. . The new company will retain the name EarthLink and be headquartered in Atlanta, Ga., where MindSpring's corporate headquarters are located. Michael McQuary, MindSpring's current president and chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , who will be the new company's president, said in a telephone interview from New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of that the Southern California EarthLink offices in Pasadena would continue to operate, with no layoffs planned. ``Absolutely concrete, Pasadena will be maintained, and we hope to expand those operations as we can,'' McQuary said. EarthLink has nearly 2,000 employees, while MindSpring has about the same, according to company officials. ``This will just mean that I will be coming out to Southern California more often and getting an In-N-Out burger once in a while,'' McQuary quipped. EarthLink employees reacted with surprise to the announcement, which was relayed to employees Thursday morning through an internal e-mail message. ``It was just dropped in our laps,'' said Ken Palige, 30, of Pasadena, a technical support supervisor at EarthLink. ``I'm not sure what to make of it. As of yesterday, we had no idea about this.'' Under the merger agreement, MindSpring shareholders will get one share in the new company for each share held. EarthLink investors will get 1.615 shares for each share they own. The transaction is worth about $1.4 billion, based on EarthLink's market value. The combined ISPs would create a market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. of nearly $3 billion, with close to 3 million subscribers. The new EarthLink company would be the nation's second-largest ISP behind Dulles, Va.,-based America Online Inc., which has 20 million combined subscribers with its AOL (A division of Time Warner, Inc., New York, NY, www.aol.com) The world's largest online information service with access to the Internet, e-mail, chat rooms and a variety of databases and services. and CompuServe interactive brands. McQuary said the new company wants to increase its customer subscriber base to 5 million by the end of 2000, and to 8 million the next year. CAPTION(S): box Box: Internet alliance |
|
||||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion