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CyberCash snaps up Network 1

Internet payment services CyberCash Inc. (Nasdaq: CYCH) said Thursday that it will buy privately held Network 1 Financial Corp. in a stock deal.

The merged company, which will retain the CyberCash name, will combine the electronic payment capabilities of both companies, for both on and off-line customers. Business-to-business (B2B) initiatives will also be included.

Shares of CyberCash closed up 0.06 to 1.72 in yesterday's session.

The combined companies should report annualized revenue of more than $100 million in the first 12 months, said Cybercash, which expects to be cash flow positive in the third quarter of 2001.

The two companies reported more than $3 billion in transactions between them. For its part, Network 1 expects more than $24 million in revenue this year.

Under terms of the merger agreement, shareholders of Network 1 Financial will receive CyberCash shares representing 50 percent of the equity of the merged company on a fully diluted basis.

William G. Wade, current President and CEO of Network 1, will fulfill the same roles with the combined company, once the transaction is completed. Current CyberCash CFO John H. Karnes will assume the new CFO position.