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Monday, August 02, 2004

S.Korea's Daum to Buy Lycos for $95 Mln

By Jean Yoon and Rhee So-eui
SEOUL (Reuters) - South Korea's top Web site operator Daum Communications Corp., said on Monday it would acquire Lycos Inc., the U.S. business of Spain's Terra Lycos, owner of popular sites such as Wired News and Tripod, for $95 million.
The deal underlines the growing global ambitions of technology companies in South Korea, which has more broadband connections per head than any other country, although analysts were not convinced of its investment merits.
"The buyout will provide a springboard for our company to venture into the U.S. Internet market and become a global player, Daum said in a disclosure statement to the Kosdaq exchange.
Daum will acquire 100 percent of Lycos for 111.2 billion won ($95.44 million) in cash. Terra bought Lycos in an all-stock deal in May 2000 worth $12.5 billion at the time, which was near the height of the Internet boom.
Daum will finance the deal with 70 billion won of its cash reserves and a bond issue, the statement said.
Daum, the fifth-biggest stock on the Kosdaq, rose 2.44 percent to 33,600 won as of 10:20 p.m. EDT Sunday, outperforming the wider market's 0.39 percent fall.
Lycos is ranked seventh in the United States in terms of site visits and has about 170,000 paid users, according to data provided by Daum.
South Korea has 28.6 million Internet users, or more than 60 percent of its population, and more than 11 million broad-band service subscribers, according to government data.

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