S.F.-based Quokka Sports announced an expanded
strategic and financial relationship with NBC. Under terms
of the warrant issuance agreement, NBC will acquire a
warrant from Quokka to purchase up to 10 million shares of
Quokka common stock for an aggregate of $140.8M at prices
ranging from $8.99-20.00 per share over the next three and a
half years. As part of the deal, NBC will have the right to
appoint a representative to Quokka's BOD. The nature of the
expanded relationship between Quokka and NBC is expected to
encompass the exploration of potential new joint ventures,
coverage of new sports properties, new acquisitions and
other anticipated business development and expansion
opportunities in an effort to leverage and enhance NBC
Sports' broadcast capabilities and relationships with
Quokka's digital media knowledge. Quokka will continue to
hold its 71% interest in Golf.com, while NBC will maintain
its 29% interest in the Web company (NBC). BLOOMBERG NEWS'
Scott Lanman notes that Quokka has about 46.3 million shares
outstanding (BLOOMBERG NEWS, 8/23). A Quokka spokesperson
said that NBC "is expected" to own about 14% of Quokka.
Also, the addition of an NBC rep to Quokka's BOD will
increase the board size to eight directors (WALL STREET
JOURNAL, 8/23). CNBC's Pat Bolland, on Quokka Sports: "They
have other big shareholders including Media One and Intel
and Media Technology and indeed have been busy in
acquisitions themselves in Golf.com. This is an expanding
relationship that they're doing with NBC, and indeed it will
include [MLB], golf, as well as the NCAA football schedule.
Big move" ("Market Wrap," CNBC, 8/22). Quokka shares were
trading at 8 3/8, up 1 5/8, at presstime (THE DAILY).
QUOKKA PUTS ON ITS GAME FACE: The INDUSTRY STANDARD's
Migeul Helft examines Quokka's joint Olympic venture with
NBC, www.NBCOlympics.com, and writes it is a "make-or-break
event" for Quokka. Helft: "Quokka's gamble is gutsy, and
all the more so because the company is shouldering most of
the cost and much of the risk of producing NBCOlympics.com."
And Quokka officials "concede" that it will be "hard to lure
viewers from name-brand coverage during the 17-day Olympic
competition." Quokka COO Michael Gough: "I am concerned
about changing users' behavior in a short period of time.
If people have ESPN bookmarked, and they get their Net
sports appetite satisfied there, that will be competition
(for us)" (INDUSTRY STANDARD, 8/21 issue).
