Netscape Stock Jumps on Rumor of Merger
Netscape stock received a jolt April 16, rising $5 13/16 to $25 9/16 amid rumors that Sun Microsystems was interested in acquiring the company. Sun has been linked to Netscape, Mountain View, CA, for months. In February, Netscape also was linked to IBM, Oracle Corp. and America Online. Those rumors drove Netscape stock up from a 52-week low of $14 13/16.
For two years, healthy profits drove Netscape's stock price, but since it declared a loss of $88.3 million for the fourth quarter of 1997 -- its first negative performance since going public in August 1995 -- its stock has bounced on merger speculation.
While not quite Black Monday, the expected correction in the market arrived April 27 as fears of rising interest rates drove stocks to their largest drop in three months. The Dow Jones Industrial Average lost 146 points, and the Nasdaq dropped 48 points.
On a day when decliners led advancers by an 8.5-to-1 ratio, Sitel, Omaha, NE, lost $1 to close at $11, and Hello Direct, San Jose, CA, was down $1 9/16 to $9 7/16.
Most companies in the DM Portfolio suffered little effect from the downturn. Two bucked the trend with solid gains. Internet darling K-tel, Minneapolis, continued its Web site-related climb, gaining $8 to close at $34 3/4. Beleaguered Cendant Corp., Parsippany, NJ, was the third-most-traded issue of the day, gaining $1 5/16 to close at $23 5/16.
More moves by Cendant are helping its stock continue a steady comeback from its free fall to $19 1/16 last month after accounting irregularities were reported. Last week, it completed its $1.3 billion acquisition of National Parking Corp., London, and solidified its finance team. Scott Forbes was promoted to executive vice president and chief accounting officer, Samuel L. Katz was named to executive vice president for strategic development, and David M. Johnson was hired as executive vice president for finance.
The completion of a cash tender offer by Great Universal Stores PLC, Manchester, England, for all outstanding stock of Metromail Corp., Lombard, IL, will take it off the Portfolio list. Metromail shareholders will receive $34.50 in cash for each share. Metromail stock traded publicly for the last time April 17, closing at $34 5/8.
Investors still interested in Metromail can stay involved in the company indirectly by purchasing shares of GUS, which also counts Experian, Orange, CA, and Direct Marketing Technology, Schaumburg, IL, among its holdings. GUS trades on the stock exchanges in London, Switzerland and the Netherlands under the GUS ticker symbol and over the counter in the United States under the GRUSNY symbol.