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Freeserve enters bid talks
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November 22, 2000: 3:30 a.m. ET
U.K. Net firm discusses buyout; France's Wanadoo says it's interested
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LONDON (CNNfn) - Freeserve PLC admitted Wednesday it was in talks to be bought in an all-stock deal, but Britain's largest Internet service provider dashed hopes that any buyer would pay a price far above the current depressed value of its shares.
France's largest ISP, Wanadoo SA, a listed unit of France Telecom SA, told Reuters that the British counterpart  is one of the companies it is considering as a merger partner. However the news agency also reported that Freeserve is in talks with more than one party regarding a takeover offer.
Wanadoo officials weren't immediately available for comment.
In a statement Wednesday Freeserve said it was in "discussions which may or may not lead to an offer being made for the company in shares." The U.K. firm added however, that "it is unlikely that any such offer would be at a substantial premium" to Freeserve's current share price.
Freeserve, which is majority-owned by electronics retailer Dixons PLC (DXNS), was once the darling of the London stock market, having pioneered free Internet access and collared more than 1 million users. However, the shares now stand at a fraction of the peak 977 pence they fetched earlier this year.
Nevertheless, Freeserve (FRE) stock was up 3 percent at 151 pence in midday trade Wednesday, valuing the firm at around £1.5 billion ($2.4 billion). Earlier the shares had bounded as much as 14 percent higher. Wanadoo (PDOO) stock fell 4 percent to  11.92 in Paris. Dixons rose 3 percent to 226 pence in London.
Although Freeserve blazed a trail by offering subscription-free Internet access in the U.K., the roller-coaster ride for its shares has seen them shunted in and out of London's blue-chip FTSE 100 index several times. 
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Wanadoo
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