Bezos gets crabby over reports Amazon is short of cash
And its not all happy news for other ebiz players
Amazon's CEO Jeff Bezos has got very shirty over a report by Lehman Brothers analyst Ravi Suria that said the online giant was fast running out of cash. Amazon's credit was described as "weak and deteriorating" and the cash would last to the start of next year at best. Amazon's share price fell 20 per cent. Bezos, with the support of another analyst - Merrill Lynch's Henry Blodget - has said this is all nonsense and claims to have $1 billion in cash at the ready. Henry's report drew a very different picture. Amazon will soon be in profit, he said, burning another $300 million to $500 million tops before the cash flow turns around.
France Telecom has put an unexpectedly low price on its Internet arm, Wanadoo. Earlier in the year, analysts had given it a market price of 30 billion euros (about £19.5 billion), but the giant telco yesterday put its worth at just £13 billion. Only 10 per cent of Wanadoo will be sold and the low price is an obvious attempt to guarantee a successful float -something that is of paramount importance in the current climate.
Also suffering from share price woes is Virtual Internet. Its business in the US and Italy isn't growing as fast as it thought it would, said the profit warning, and soon after a third of its share value had been wiped. It is also delaying the launch of its domain name registration/hosting service. Pre-tax losses have tripled for the half-year, up to £4.2 million.
Eidos has admitted informal talks with the US' Electronic Arts over a possible sale. Eidos is expected to decide on Monday whether to sell itself - a move aimed at escaping the clutches of French software company Infogrames, which has made its hostile intentions known.
Internet Business Group (IBG) has bought a £75,000 stake in Instant Party, the party and event organiser that trades online as Dr. Party. Instant Party will also get a Web and WAP technology specialist in the deal. Danielle Nay, MD at Dr Party said that they would be having a party to celebrate.
Video Networks said yesterday that it has raised enough money to fund its European expansion. The company collected a further £102.5 million in private equity from high tech investment group Digital Explosion. This brings the total money raised to £170 million, which will be used to fund the roll out of its HomeChoice service. The service was launched in London yesterday.
Telework group, is set to float on August 3. The company will be valued at £200 million of which 95 per cent will be held by the directors. Ian Lenagan, one of the founders will hold 64 per cent of the shares of which 10 per cent will be distributed among the staff. The remaining 54 per cent will be worth around £108 million. Not a bad return on the old red beemer he sold for £7000 to start the company 14 years ago. ®