10/14/96 WIRED'S TANGLED IPO

WIRED'S TANGLED IPO

WIRED VENTURES is back on the Street with an initial stock offering. The money-losing publisher of Wired magazine and the online HotWired service, however, presents a prospectus that sounds like a cry for help.
Distress signals abound. The latest offering is smaller than the one pulled this summer ($66.5 million vs. $75.9 million). Wired now values itself at $251 million (at $12 per share), almost half what it did in June. The prospectus shows that Wired, which has never turned a profit, lost some $15 million on operations in just the first half of '96. That's more than in the previous three years combined and doesn't count an extra $20.5 million in losses from a write-off of some R&D costs.
Wired says it needs the $66.5 million in equity capital for new products, since more than 90% of revenue now comes from the magazine. The track record isn't reassuring. For instance, its TV program, The Netizen, was to debut last summer on MSNBC but has been shelved for now. The prospectus says the fresh equity will meet Wired's development needs through 1997, then it will need more capital. Wired, in registration, declined to comment. On the plus side, its stellar brand name may yet boost its fortunes.
EDITED BY LARRY LIGHT By Andrew Ross Sorkin