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CMGI wants Lycos vote
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March 18, 1999: 7:57 a.m. ET
Hoping to block USA Network deal, 20 percent holder seeks shareholder say
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NEW YORK (CNNfn) - Hoping to block USA Networks Inc.'s proposed acquisition of Lycos Inc., CMGI Inc., which holds a 20-percent stake in Lycos, is reported to want shareholders to vote on the plan rather than propose an alternative.
Officials at CMGI (CMGI), the largest shareholder of Lycos (LCOS), believe a majority of shareholders will defeat the plan, the Wall Street Journal said Thursday.
The Andover, Mass.-based CMGI has repeatedly said it dislikes the USA Networks (USAI) acquisition because of how the deal is structured. The Journal's report comes amid speculation that CMGI would reveal other suitors for the Web portal company.
And in a new twist in the battle over Lycos, the Journal said Thursday that USA has options to buy 17.5 percent of Lycos should another suitor surface. But if shareholders defeat the proposal outright, the options agreement terminates, the Journal said.
CMGI chief executive David Wetherell initially expressed doubts about the transaction because USA Networks offered Lycos only a 2-percent premium over its stock price when the deal was announced last month.
Last week, Wetherell resigned from Lycos' board to protest the deal. The move opened the door for Wetherell to seek additional suitors for Lycos.
Peter Mills, CMGI's managing director, said Monday third parties have expressed an interest in Lycos, though he didn't provide further details.
USA Networks Chairman Barry Diller has previously said he is not considering renegotiating the deal with Lycos.
The shareholder vote is expected in July.
On Wednesday, CMGI shares, which have risen 229 percent year-to-date, fell 5 3/8 to 175 3/8. Lycos shares dipped 3 3 /4 to 101 3 /4, while USA dropped 1/16 to 37 1 /2.
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Lycos
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USA Networks
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