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RealTime IT News

ASX Net Stock Weekly Wrap

With the benchmark Australian All Ordinaries index hovering around record levels and the US' Nasdaq making another run at 5000, Australia's big Internet plays finished the week on a high. The week past saw Australia's biggest technology sector deal and a lot of US driven volatility in the Internet space.

Deal of the week obviously goes to the Solution 6/Sausage Software merger. However, the big winner out of the merger does not appear to be the new look Solution 6 (SOH). Telstra Corp. (TLS) emerged from Monday's deal with control of Australia's biggest listed Internet play. Solution 6 CEO Chris Tyler should also be grinning, he retained the right to acquire 10% of Solution 6 (although the exercise price for most of his options is now around $10).

Stock in Solution 6 finished the week at $12.27 up almost $2 from it week open of $10.30. Sausage Software (SAS) finished at $6.84, coming off a high of $8.20 but still well up on its week open of $6. Telstra Corp. finished the week flat at $7.74 despite the positive effect the merger is expected to have on Telstra's Internet businesses.

Analysts blamed a report in the influential Barrons for Internet losses on Tuesday. The report entitled "Burning Fast," listed 51 public US Internet companies it claimed will burn through their cash reserves within 12 months. The Nasdaq dropped more than 3.9% in one day after Barrons hit the news stands.

Homegrown portal Looksmart(LOK) clawed back some of its losses to finish the week on a high after announcing a deals with Go2Net, carsmart.com, creditland.com and eCoverage.com in the US. Looksmart was hit hard by the US sell down of Internet plays early in the week but recovered from an intra-week low of $3.58 to close Friday at $3.93.

Australia's junior mining stocks continue to dominate the more speculative end of the Internet market. Pilbara Mines closed the week $1.33 higher than its $3.27 open at $4.60. Rumors regarding the stock continue to fly - but it appears that all the hype is about Pilbara's investment in Request DSL, the aspiring broadband provider that is yet to is yet to get its telecommunications license. Request has enlisted the world's second biggest company, Cisco Systems, to assist in the roll out of Request's Asymmetric Digital Subscriber Line (ADSL) network.



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