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DoubleClick Shares Rise Despite Failed Deal with NetCreations

Shares of



rose 88 cents, or 9.5%, to $10.06 in morning


trading following yesterday's news that



has nixed an agreed-upon merger of the companies.

NetCreations, an email marketing firm, said an unidentified third party offered to acquire all of its outstanding stock for $7 a share in cash, a proposal DoubleClick declined to match. DoubleClick had offered to buy NetCreations in October in a stock swap valued at $191 million. But DoubleClick's stock was trading around $26 at the time, and has fallen substantially since then.

DoubleClick said NetCreations is required to pay a breakup fee of $8.6 million plus expenses.

"We are disappointed that NetCreations won't be a part of our success, but considering NetCreations' recently announced operating results and our own internal progress on email, we have decided not to raise our existing offer," DoubleClick said in a statement.

Earlier this month NetCreations said it expects fourth-quarter earnings of 0 cents to 2 cents per share, well short of the 11 cents Wall Street was predicting.

Shares of NetCreations were down three cents, or 0.5%, to $6.63 in recent



Despite the failed merger, two analysts said Friday they were not changing their outlook for DoubleClick, despite disappointment the deal fell through.


SG Cowen

report said the firm will stick with its neutral rating on the stock even though, "DCLK's logic not to counter is lost on us, since DCLK was so aggressive in stating only two months ago how strategic NTCR was to boosting their email product marketing efforts for advertising clients."


Lazard Freres

report reiterated its hold rating. "DoubleClick is left with a strong email marketing business, but will not be the leader in the market," the firm wrote. "DoubleClick has had the opportunity to make other strategic acquisitions, but may have been too conservative in using its stock or cash."