Can you say "consolidation"? We hope so, otherwise you may have been left in the dust this week on the Street. Sprint finally gave (well, sold actually) its hand in merger-marriage to MCI WorldCom, winning a place in the business deal record books. And the airwaves made waves too, as Clear Channel snapped up AMFM -- thus becoming the ruler of the radio industry. Read all about these deals (and Webvan's woes) below. Also, be sure not to miss our Easy Money feature this weekend on the posh Nethead event in Europe -- TSC was there with bells on. And Gary Schreier, producer of "TheStreet.com" on the Fox News Channel, gives a brass-tacks account of putting the show together in The Cutting Room. Check it out!
Now That's a Phone!
The deal was
big, you could've heard a pin drop -- or
something like that.
agreed to acquire
for $115 billion in stock this week. If the deal goes through, it will be the largest merger in business history, but many investors
fret that cranky regulators -- they're
spoiling the fun! -- could delay the deal.
The acquisition may be expensive for MCI WorldCom, but, if successful, will secure a
much-sought prize: a serious wireless business. The merged
would be able to challenge
and the not-so-Baby-sized Bells. Those
hurt by the deal may include network suppliers
; as the long-distance monsters combine, redundancies in equipment may slow their purchasing from suppliers.
Of course while all the money folk were worrying about these
, consumers were fussing about their phone rates.
opined that the deal may actually signal an end to the brutal price war that's been afflicting long-distance providers lately.
Hey, wait a second -- what about that 2-cents-a-minute worldwide rate we've all been waiting for?
Ever wish you could somehow snatch something you've said aloud back into the safe confines of your mind? The good folks at
can probably relate.
Late Wednesday, Webvan postponed its highly anticipated IPO after the
Securities and Exchange Commission
apparently took issue with some things Webvan said during their pre-IPO roadshow. (And we're don't mean something like, "I think you're selfish.")
Webvan: Join the discussion on
As part of its roadshow, Webvan disclosed things that weren't in its prospectus, which is a no-no and was
pointed out by
. Add to that the fact that executives didn't exactly hide from the
press during the company's quiet period (which is kind of like quiet time in
kindergarten but happens before and right after a company's IPO).
And of course the Webvan IPO was expected to be huge, even in Internet IPO terms, so any delay was big news.
Now, there's all sorts of
talk about whether the SEC will change its quiet-period requirements. Lashinsky even has his own
ideas about this.
But of course, that would mean the SEC would have to take the lead, and government employees most often lead only when it comes to things like trying to beat the traffic home.
So much for
video killing the radio star.
on Monday agreed to acquire
for $16.58 billion in stock. The deal will make Clear Channel the biggest radio company by revenue given that it's No. 3 now and AMFM is No. 1,
The Wall Street Journal
is No. 2. But hey, Infinity still has
As a result of the deal, Clear Channel also will have a presence in 90 of the country's 100 biggest markets. So much for diversity.
The transaction is just the latest in the massive consolidation that has taken place in the radio industry since the
Federal Communications Commission
in 1996 eased ownership rules. The idea is that by owning a lot of stations, radio companies can sell advertisers on packages covering the demographic spectrum while cutting back-office expenses.
Meanwhile, the deal might as well have been put on the air before it happened. The stocks and options
went bonkers ahead of the announcement.
U.S. News Editor Erle Norton contributed to this article.