Mergers, acquisitions and joint ventures

Spanish Internet company

Terra Networks


agreed to buy Internet search company



for $12.5 billion in stock, or $97.55 a share. The combined company, to be called

Terra Lycos

, will have an estimated 50 million unique users and 175 million daily page views.

As part of the agreement, Germany's


agreed to purchase $1 billion of advertising, placement and integration services over five years.

This morning

ABN Amro

cut Lycos to hold from outperform, while

Merrill Lynch

analyst Peter Bradshaw cut Terra to neutral from accumulate. In his note, Bradshaw said, "(w)e expect the premium paid for Lycos may outweigh the synergies gained. As a result we expect a transfer of value towards Lycos and away from Terra."

Also this morning,

UBS Warburg

downgraded Lycos to hold from buy.

For more on this

story, see coverage from

joint newsroom.

Online consumer automotive firm




America Online


signed a four-year deal that will boost AOL's online car sales offerings to its more than 22 million subscibers.

A group of major chemical companies agreed to form a B2B e-commerce company to operate an online marketplace for the global chemicals industry. The companies include





BP Amoco




(DOW) - Get Report


Du Pont

(DD) - Get Report


General Electric

(GE) - Get Report

unit NBC and

Time Warner


unit Time Warner Cable said they signed a retransmission pact through 2008.

Hughes Electronics


is likely to benefit from billionaire investor Craig McCaw's decision to merge his planned



ICO Global Communications'

satellite phone project,

The Wall Street Journal

reported. Hughes' satellite-making unit is scheduled to direct all engineering, systems-integration and testing efforts for ICO, as well as supply up to eight additional satellites beyond the 12 already announced by the venture, the story said.

Data communications company




Qwest Communications International


sealed a multimillion-dollar multiyear deal with


(MSFT) - Get Report

for high-speed Internet access.

M&T Bank

(MTB) - Get Report

said it will buy

Keystone Financial


for $1 billion. Under terms of the merger, Keystone shareholders may elect to receive 0.05 of a pre-split share of M&T common stock or $21.50 in cash in exchange for each outstanding share of Keystone common stock. Simultaneous with the completion of the merger, M&T intends to declare a 10-for-1 split on its common stock.


(STAF) - Get Report

, a staffing services company, said it will sell its Commercial Services division to investment firm

Stephens Group

for $196 million in cash.


(XRX) - Get Report



(DELL) - Get Report

announced a strategic marketing relationship which calls for Dell to carry out the direct marketing of Xerox-branded office printers in the United States, followed by Europe and other worldwide markets later this year. The joint marketing agreement with Dell represents the most significant relationship to date between Xerox and a leading personal computer company involving color and black-and-white laser and solid ink printers.

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Earnings/revenue reports and previews

(Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.)



reported second-quarter earnings of 87 cents a share before items, beating the 23-analyst estimate of 82 cents and the year-ago 73 cents. Total revenue grew 15% to $12 billion from $10.4 billion in the previous year. Hewlett-Packard said the latest results reflect a company reinvention that set it on a course of consistent double-digit growth.

Lehman Brothers

raised its 2000 earnings-per-share view on Hewlett-Packard to $3.50 a share from $3.40.

H-P spinoff

Agilent Technologies

(A) - Get Report

also reported second-quarter results. The company said it earned 36 cents a share in the latest quarter, including a gain of 4 cents. The 11-analyst estimate called for 32 cents, while the year-ago earnings were 41 cents. Agilent said the 11% decline in its operating earnings reflected planned activities related to operating independently.

For more on these

earnings, see coverage from

joint newsroom.

Analog Devices

(ADI) - Get Report

reported second-quarter earnings of 32 cents a share, beating the 18-analyst estimate of 29 cents and the year-ago 11 cents. Analog said its quarterly earnings tripled amid booming demand for chips in cell phones and other products. The company also forecast higher third-quarter earnings-per-share and said revenues could rise more than 65% for the full year. It expects third-quarter earnings between 36 cents and 37 cents a share based on a backlog, which is above the 17-analyst estimate of 31 cents. The company said it expects third-quarter revenue of $640 million to $650 million and that 2000 revenues could exceed $2.4 billion.

Campbell Soup

(CPB) - Get Report

posted third-quarter earnings of 32 cents a share, beating the 13-analyst estimate of 31 cents but below the year-ago 37 cents a share.

Consolidated Stores

(CNS) - Get Report

reported a first-quarter loss of 12 cents a share, beating the 14-analyst estimate of a 15-cent loss, but an increase over the year-ago loss of 3 cents. The first-quarter loss, excluding the company's online toy store

, was 5 cents a share.

Ross Stores

(ROST) - Get Report

reported first-quarter earnings of 47 cents a share, in line with the 13-analyst estimate and up from the year-ago earnings of 37 cents a share.



reported first-quarter earnings of $1.04 a share, in line with the 14-analyst estimate and up from the year-ago earnings of 62 cents.

TD Waterhouse


, the online brokerage owned by Canada's

Toronto-Dominion Bank

(TD) - Get Report

posted second-quarter earnings of 20 cents a share, beating the 10-analyst estimate of 16 cents and more than double the year-ago 9 cents. The company reported earnings of 15 cents a share in the previous quarter. Excluding goodwill amortization, TD Waterhouse said earnings were 23 cents in the latest quarter and 11 cents a year ago. TD Waterhouse revenues during the quarter rose 22% to $488.7 million from $381.6 million last quarter and were up from $249 million a year ago. A slowdown in trading during the month of April hit growth in revenue trades per day. Trades grew 25% on the quarter to 239,800 from 179,400 in the three months ended Jan. 31. That's a slowdown from the 40% growth to 236,600 trades the company was averaging during the first three months of the year when stock trading volumes were at record heights.


(TTC) - Get Report

reported second-quarter earnings of $2.08 a share, beating the three-analyst estimate of $1.96 and up from year-ago earnings of $1.83 a share.

Analyst actions



(MAT) - Get Report

: UP to buy from hold at

Salomon Smith Barney

; price target: 16.

Public Service Enterprises

(PEG) - Get Report

: UP to buy from hold at

ABN Amro

; price target: 44.

Sprint PCS


: UP to strong buy from buy at

W.R. Hambrecht

; price target: 85.



(T) - Get Report

: price target DOWN to 65 from 75 at

Salomon Smith Barney





: NEW buy at UBS Warburg; price target: 90.

Commerce One


: NEW buy at UBS Warburg; price target: 65.



: NEW buy at

ING Barings

; price target: low 30's.

Igen International


: NEW buy at UBS Warburg; price target: 30.


(SITE) - Get Report

: NEW buy at

Lehman Brothers

; price target: 31.

Group Moves

Credit Suisse First Boston

raised the price targets for two retailers:

  • The Limited (LTD) : raised to 55 from 46.
  • Tiffany (TIF) - Get Report: raised to 80 from 75.

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A federal jury ordered

Bear Stearns


to pay $111.5 million to Henryk de Kwiatkowski, a Canadian investor, who claimed the firm's negligence resulted in currency-trading losses of $300 million in his account, the




(MAT) - Get Report

will name Robert Eckert, the 45-year old head of

Philip Morris'

(MO) - Get Report

Kraft Foods

unit, as chairman and CEO. Eckert succeeds Jill Barad.

The Heard on the Street column in the



T. Rowe Price

technology fund manager Charles "Chip" Morris has reduced holdings of bellwethers like


(DELL) - Get Report



(INTC) - Get Report

and Microsoft in favor of smaller tech companies that are more focused on communications, networking and the Internet. Alternatives such as

Sun Microsystems

(SUNW) - Get Report



(ORCL) - Get Report

may be more expensive, but according to Morris, "the epicenter of technology is shifting away from the PC."

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