March 18, 1999 9:30 AM PST
Diller turns to financial gurus for support
While the meeting will focus primarily on the status of USA Networks and its many properties, such as the Home Shopping Network and Ticketmaster Online-CitySearch, attendees expect Diller to rehash the advantages of his company's planned merger with Lycos.
Today's meeting comes amidst moves by CMGI, Lycos's largest shareholder, to shop for alternative options to the proposed USA deal.
Last week, CMGI chairman David Wetherell resigned from the Lycos board of directors in protest of the USA proposition. Wetherell has reportedly hired on financial services firm Morgan Stanley Dean Witter to explore alternatives to the USA acquisition, such as courting bids from third parties.
However, as reported by CNET News.com, CMGI will likely try to block the USA proposition during the Lycos shareholder vote expected in three to four months instead of presenting an alternative deal to Lycos board members. This will avoid triggering a termination agreement that grants USA Networks a 17.51 percent stake in Lycos valued at 127.14 a share.
In a recent interview, CMGI @Ventures managing partner Peter Mills said that despite several third parties expressing interest, "We are going to take our time to figure out what we believe is the best interest for the Lycos shareholders." Mills would not say who had expressed interest.
Analysts and observers expect considerable lobbying efforts during the coming months before the shareholder vote.
"It'll be like a political campaign," said Abhishek Gami, an equity analyst at William Blair. "We'll see three or four months of pure speculation [that will] culminate at that shareholder vote."
Today's meeting also will be attended by the heads of all USA divisions, according to a company spokesman.