The speculation surrounding which media giant will buy Lycos is over as the Internet portal today confirmed it is to merge with the ecommerce operations of USA Networks to form a new venture.
Despite the company vehemently denying it was up for sale, (see Newswire 26 January) the reality of scale has won through and the Internet portal will do a deal with USA Networks consolidating TV and Web audiences to form what the company described as one of the largest ecommerce operations in the world.
Under the terms of the deal USA Networks will merge its Home Shopping Network, Ticketmaster Online-Citysearch (TMCS) and Internet Shopping Network/First Auction with Lycos to form the new company, USA/Lycos Interactive Networks.
The stock only deal will see USA Networks owning 61.5 per cent, Lycos' shareholders will own 30 per cent, TMCS shareholders other than USA Networks will own 8.5 per cent of the USA/Lycos equity.
The new combined venture will potentially have the capacity to reach 70 million television homes and 30 million people on the Internet. It will include what it claims are four of the top 20 websites on the Internet: Lycos, Tripod, Hotbot and Angelfire.
"This places all the necessary ingredients for electronic information and commerce, from 'old' soup to 'new' nuts, into one centrally and aggressively managed enterprise," said Barry Diller, chief executive of USA Networks and chairman of the new company.
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