CMGI reorganises business units
Published: 07 Sep 2000 13:09 BST
CMGI is reorganising its business structure, dividing its operating companies and venture capital investments into six different business units.
The company said it will use those divisions -- search and portal, infrastructure and enabling technologies, internet professional service, interactive marketing, e-business and fulfillment, and venture capital -- when it reports earnings, breaking down consolidated earnings by operating segment.
As a result of the reorganisation, investors will have an easier time following CMGI's financial results, which are muddled by investment gains and a lot of moving parts.
CMGI also said it plans to cut the number of operating companies it runs from 17 to five to 10 total. And it will merge its three current venture capital funds into a single fund, dubbed CMGI@Ventures IV.
It did not give a date for the reduction of operating companies, or say which ones it would retain.
The company also announced that it will not establish a separate international venture fun with Hicks, Muse, Tate & Furst and PCCW, as previously announced, although it will continue to invest on an informal basis with those firms.
"Our new operating structure is highly complementary to CMGI's unique business model. This structure will focus the Company strategically and specifically on those market segments which provide the greatest opportunity for growth while simultaneously providing the investment community with additional clarity and measure for our majority-owned operating companies," CEO David Wetherell said in a release.
CMGI has been making moves to boost its profile lately and shore up its finances lately. Wetherell has stated that his company is not dependent on the IPO market for its financial health, a move drew a positive response from analysts.
The company topped analysts' estimates for the third quarter, posting a loss of $428m (£295m), or $1.53 a share, on sales of $225.9m.
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