Wayne, Pa.-based Internet Capital Group (ICG), a business-to-business (B2B) e-commerce holding company, was one of the most anticipated IPO, in 1999. The goal was to build the ICG companies that could get the number one or two position in their respective markets, providing software and services to help businesses increase efficiency and reduce costs. Operating strategy MCG was 1) to identify the most attractive B2B companies / opportunities, 2) the acquisition of shares (preferably 40% or more) of the partner companies (companies invested in ICG), 3) to provide operational and strategic direction through its advisory board and management team, and 4) further cooperation within the network of the partner through their central "hub" position. In 1999, ICG shares closed up more than 100% on the first day of trading, giving it an instant market capitalization of $ 3 billion. At its peak in December 1999, it was a market capitalization of $ 52 billion. By 1999, the ICG rate of about 30 B2B online business (45 by the end of 1999, 50 May 2000 and 77 October 2000). By 2000, however, things have changed for the company. In November 2000, ICG reported a third quarter loss of $ 263.9 million, compared with a loss of $ 15.3 million for the same period a year earlier. During this time, it also laid off 35% of its staff (about 50 people). In addition, the share price was $ 4.48 from 98% of its year high, taking its market capitalization to $ 1.39 billion. As of September 2001, the shares of ICG bottomed out at $ 0.34 and eventually leveled at $ 0.77 in March 2002. The same analysts who once touted as a big winner ICG suddenly Downgrades, concepts and perspectives of ICG. "Hide
by George Parker, Victoria Chang Source: Stanford Graduate School of Business 24 pages. Publication date: April 19, 2002. Prod. #: E119-PDF-ENG
Related Case Solutions & Analyses:
Sun Life Financial: Entering China
ASIMCO: Developing Human Capital in China
Managing Human Resources Business Fundamentals Series
WBLT Public Television 1999
The Rise and Fall of Iridium
O.M. Scott & Sons Co. Leveraged Buyout
General Electric Co.: Preparing for the 1990s
Fortescue Metals Group: Becoming “The New Force in Iron Ore”
Joseph Vigneault and the Capital Pool Company Program
Myriad (A): Breast Cancer Testing in Britain
