Compaq Computer Corp.'s announcement late last month that it plans to buy Digital Equipment Corp. could have a significant impact on DoubleClick, a leading Web advertising network and rep firm that plans to file for an initial public offering soon.
According to DoubleClick's public filings with the Security & Exchange Commission, 44.7% of DoubleClick's revenue comes from its biggest customer: the AltaVista search engine, a Digital property whose future is unclear.
DoubleClick acknowledged the uncertainty of the situation in its Jan. 28 SEC filing, in which it wrote that in light of Compaq's acquisition, "The loss of AltaVista as part of the DoubleClick Network ... would have a material adverse effect on the company's business, results of operations and financial condition."
Bob Hult, VP-general manager of AltaVista, declined to comment on the future of the search engine service.
NOT A CORE BUSINESS
However, regarding DoubleClick, Mr. Hult said, "They're a great partner. We have a contract with them, and we're certainly in a position to continue doing business." Spokespeople from Compaq, Digital and DoubleClick declined to comment.
"There's obviously going to be uncertainty" about the future of DoubleClick's relationship with AltaVista, said Tim Sloan, an analyst at the Aberdeen Group. "It's going to impact their stock price."
Jim Nail, a senior analyst at Forrester Research, said AltaVista is not a core business for Compaq. "That certainly makes it sound as if it's a candidate to be spun off or sold off."
Copyright February 1998, Crain Communications Inc.