Tiscali to Acquire 70% Stake in Excite Italia
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[London, ENGLAND] European Internet giant Tiscali announced Monday it has agreed to acquire 70 percent of Excite Italia, leaving Excite@Home with just the remaining 30 percent.
The deal follows a capital injection of US $22 million by Tiscali and the sale of 50 percent of Excite Italia by Seat Pagine Gialle (Telecom Italia).
Renato Soru, executive chairman and chief executive officer of Tiscali, said the deal was an important step toward becoming "the Internet leader" both in Italy and in Europe. Excite@Home, he said, would be a key partner in pursuing this strategy.
Tiscali explained the reasoning behind the acquisition by saying "what might have been." Had the deal occurred previously, the combined operations in Italy would have generated pro forma advertising revenues of around US $14 million in 2000, with nearly 300 million monthly page views in January alone this year.
One of Italy's most popular Internet portals, Excite Italia has acquired over a million registered users since opening in 1999. It has almost 1.5 million unique visitors monthly.
John O'Farrell, Excite@Home's executive vice president, international, said partnering with Tiscali, one of Europe's largest and fastest-growing ISPs, was great news for Excite@Home.
"Leveraging Tiscali's obvious strengths in Italy provides us with great opportunities to build on Excite's leadership presence in Italy," said O'Farrell.
From Monday it will be "business as usual" at Excite Italia, where the management team will remain in place and the company will continue to operate independently. As before, it will still have exclusive access to Excite@Home's media-related know-how, technology, and brand in the Italian market.
For Tiscali, one reason for not rocking the boat is Excite@Home's expertise in broadband portal technology, which may prove instrumental in the future for gaining position in a fast-growing broadband market.
Tiscali, which claims the largest geographical footprint of any European Internet provider, agreed to buy France's second-largest ISP, Liberty Surf, in early January this year. That acquisition was estimated to bring Tiscali's total user-base to 4.9 million active subscribers.