Lycos will exchange $83 million in stock for Wired, plus additional stock to cover Wired's outstanding expenses when the deal closes, which is set for yearend pending approval from Wired shareholders.
Earlier this year, Lycos purchased online community Tripod and WhoWhere, which owns home pages site Angelfire and free e-mail site MailCity. With Wired Digital, Lycos said it now reaches 40% of the Internet market. It plans to push ad sales across the Lycos Network and integrate content from each of the sites. For instance, Wired Digital's content for Web developers on Webmonkey will be featured on Tripod and Lycos.
Beth Vanderslice, president of Wired Digital, said Lycos' multibrand strategy is what attracted it to the deal. "We were confident we could preseve our brand and product," she said. "Organizationally, I look forward to the relief of not having to invest in infrastructure to support our growth," she added, noting this would allow Wired Digital to focus on content and programming.
Bob Davis, president-CEO of Lycos, said there would be no layoffs with the acquisition and that HotBot would continue to contract out its search engine capabilities to Inktomi.
Copyright October 1998, Crain Communications Inc.