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Sweden's Linne, Cell Merge to Form New Net Company

Leading Swedish Internet companies Linne Group AB and Cell Consulting Group AB merged last week to form a new Internet consulting company which will become the largest Scandinavian Internet company to focus on business development.

Both companies are profitable and growing fast. Linne Group is a slightly larger company, but Cell is more focused on the Internet and its executives will lead in this new venture.

Cell is also involved in digital TV, controlling one of Sweden's digital channel. One day after the announcement of the merger, Linne acquired Swedish digital channel production company TELETV, indicating that the new company may pursue this market as well.

Jan Carlzon, current chairman at Cell, will also act as chairman of the new company, with Cell's Marcus Backlund carrying over his role as CEO. The name of the newly formed merger has not yet been announced.

The companies announced plans to expand through acquisitions and new establishments in Europe, as well as pursuing partners in the U.S. The company plans to soon become one of the leading companies in Europe's digital media business development market, said Backlund.

U.S.-based USweb is establishing an operation in Sweden, and the company may pursue talks with Linne/Cell in future, according to USweb spokesperson Pal Roppen.

Linne Group acquired Norway's New Media Science in May. The Norwegian Net company is member of Nordic Net Partners, main rival to Sweden's Framtidsfabriken Netsolutions.

Market analysts are guessing that Nordic Net Partners will soon break up, as various partners are acquired by Framtidsfabriken Netsolutions or others in the race to bigger market shares.

Cell Consulting Group AB stock owners will float a new capital issue from Linne Group AB. Linne Group AB is traded on the Stockholm Stock Market. After the announcement, Linne's stock value rose to approximately SEK 1 billion (US$120 million).



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