Newspaper article The Florida Times Union

Success of e.TV Shifts Firm's Focus

Newspaper article The Florida Times Union

Success of e.TV Shifts Firm's Focus

Article excerpt

When Compu-Dawn Inc. went public in 1997, the stock didn't take off like other technology issues.

Unfortunately for Compu-Dawn, a relatively small firm that develops public safety software, it wasn't an Internet company. So it didn't receive the attention that other technology stocks received.

But Compu-Dawn last month got into the Internet business by hitching its wagon to LocalNet Communications Inc., a Jacksonville company that provides Internet access and other computer services through home television sets.

Compu-Dawn had made a $1.8 million loan to LocalNet last fall and acquired the operating assets of LocalNet in January to satisfy the loan. The LocalNet operations were renamed e.TV Commerce Inc. and while Compu-Dawn is still selling its public safety software, it expects e.TV to be the main focus of the company.

"We'll eclipse their current business," said Teddy Turner, a cohfounder of LocalNet who was named chairman of CompuDawn after the transaction.

Turner, son of media mogul Ted Turner, and e.TV President Rudy C. Theale founded LocalNet in 1997 and hooked up with Compu-Dawn to help grow the business.

"We needed capital. They needed a better business for their public vehicle," Theale said.

The deal had an immediate impact on Compu-Dawn's stock. It closed 1998 at 5 7/8 but jumped as high as 11 3/16 in January after the company announced the deal to acquire LocalNet's business.

The stock has dropped back to 4 5/8, but Compu-Dawn Chief Executive Officer Mark Honigsfeld is confident that the deal will help the stock in the future.

"Our shareholders have taken notice," Honigsfeld said. "The stock now has been recognized as a different type of company."

Compu-Dawn's public safety software products are sold mainly to law enforcement agencies. Since the company was dealing with public agencies, it found it difficult to grow the business because municipalities were sometimes taking two to three years to make spending decisions, Honigsfeld said.

"Our shareholders were not prepared to wait around," he said, so the company began looking for another business with better growth potential. …

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