David Wetherell: Netting Some Winners
Score a triple play for David Wetherell, CEO of Internet holding company CMGI. On May 12, USA Networks chief Barry Diller withdrew his bid for Lycos in the face of opposition from CMGI, the leading shareholder, and other Lycos investors. The same day, Wetherell said Gateway 2000 will invest $200 million in CMGI, joining Intel, Microsoft, and Sumitomo as strategic investors hoping to profit from CMGI's Net keiretsu model. At the same time, Gateway rival Dell Computer took a 4.9% stake in CMGI's Navisite, a Web-site hosting company.
Wetherell says the deals show CMGI is getting respect for the services it provides through its Net companies--and not just for its explosive stock showing. Since January, CMGI shares have risen 328% on the promise of IPOs for its portfolio companies. "Every PC manufacturer is concerned with how to optimize their PCs for the Internet," he says.
What's next? CMGI insiders say Wetherell hasn't ruled out a bid for the 80% of Lycos that CMGI doesn't own, now that Diller is out of the picture.