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CMGi lets shareholders in on majority-owned IPOs

Internet incubator CMGi Inc. (Nasdaq: CMGI) said Tuesday that it would allow its shareholders to invest in the initial public offering of its majority-owned spin-offs.

CMGi shareholders, which have been grasping for good news after the company's recent tailspin, would first get shares of Engage Technologies, a CMGi operating company that has filed to go public.

Other CMGi majority-owned businesses will also be included as they go public.

Under CMGi's directed share program, Engage will reserve a limited number of shares of its IPO for qualified CMGI shareholders at the offering price. Individual CMGI shareholders who own at least 100 shares of CMGI at the close of business on June 15 and who meet certain eligibility requirements, will be invited to participate.

CMGi (chart) said a letter detailing the specific terms for eligibility and participation in the program will be mailed shortly.

The company added that "it reserves the right to revise or discontinue such programs at its discretion."

Shares of CMGi have been retreating following the company's third quarter earnings, which missed estimates. Many analysts contend CMGi's earnings mean little considering the company is a mix of venture capital firm, mutual fund and startup.