Thursday, June 30, 2005

Rumors of potential C|Net sale spur market speculation

An AP newswire article in The Mercury News (subscription required) reports that:

CNET Networks' stock surged more than 10 percent Thursday based on a published report that the company is looking for a buyer.

The New York Post reported the technology information portal may be "shopping itself'' to investors, including Viacom and InterActiveCorp, setting off intense speculation among analysts and shareholders.

CNET, which provides online news, product reviews and software downloads, would not comment on the rumors.

"The company does have some motivating factors to sell,'' said Scott Kessler, an analyst at Standard & Poor's. "I think it's likely they could pursue an exit strategy.''

Analysts cautioned that CNET's price tag of at least $1.75 billion could make finding a buyer difficult in the short term.

While another major portal, Ask Jeeves Inc., sold for a similar price last month, Kessler said CNET's debt is heavy and its stock is overvalued, generating less interest.


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