T-Online To Buy Ya.Com
Sep. 04, 2000
FRANKFURT, Germany (AP) _ Europe's biggest Internet service provider, T-Online International AG, broke into the Spanish-speaking market Monday, announcing plans to buy Spanish rival Ya.com Internet Factory for $495 million in stock and cash.
The takeover bolsters the Deutsche Telekom spin-off with 2.3 million new members throughout Spain and Latin America _ adding to the 6.4 million members it already has in Germany, Austria and France. The combined company will reach 53 percent of Europe's Internet users, T-Online said.
Deutsche Telekom hopes to finish the deal this autumn.
T-Online will pay for the deal with 15.25 million new shares via a capital increase and $90 million in cash. The acquisition price is based on a T-Online share price of $26.56, the average closing price for the 20 days prior to Sept. 3, when both sides signed the deal.
Under the agreement, former Ya.com shareholders will own 1.25 percent of T-Online.
Spanish Jazztel PLC, the largest Ya.com shareholder, will hold over 0.87 percent of the increased T-Online equity. Under the agreement, it can only begin selling off those shares, if it chooses, after Oct. 17.
Just last week, T-Online posted a $161 million net loss in the first half after one-time charges related to its April initial public offering and new acquisitions _ including France's Club Internet.
But T-Online said it expects to be in the black in two to three years.
Acting chairman Detlev Buchal said the company intends to expand internationally by starting up its own units or merging with rivals in Europe. The number of T-Online subscribers has more than doubled in the last year.
Former chairman Wolfgang Keuntje quit two weeks ago, apparently after a disagreement with Deutsche Telekom chief executive Ron Sommer about how much to pay for Britain-based Internet service provider Freeserve PLC. The two companies were in partnership talks that did not pan out.