Freecom talks up prospects on takeover

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The Independent Online, an AIM-listed company which provides web services to small businesses, said it expected to grow 10-fold this year through further deals following its merger yesterday with, its AIM-listed rival.

Freecom, which listed in December, and Oneview, which listed in September, operate at different ends of the small business sector. Freecom sells so-called "build your own" website creation software at the top end of the market, whereas Oneview offers one-on-one Web advice to smaller businesses such as plumbers and newsagents. Freecom approached at Christmas.

Michael Williams, freecom's chief executive, said the combined group would have 55,000 customers and he expected's customers would take up freecom's more expensive products.

Freecom is paying seven shares for every five Oneview shares, valuing the latter at £135m and the combined entity at at £335m.

Stuart Lawley, Oneview's executive chairman, will stay on at the enlarged group in order to manage its expansion into the United States and to pursue a listing on Nasdaq, the American hi-tech stock market.

Mr Williams said: "We'll be 10-times this size in 12 months. We're looking to do a joint venture with a telecoms company and all the US telecoms companies are looking for content providers like us."

He added that the group would also look to play a role in the continuing consolidation of the UK internet sector.

"We're a big land- grabbing machine right now," he said.

There was also praise for Gordon Brown, the Chancellor of the Exchequer, for his support of e-commerce through 100 per cent capital allowances for hardware and software in the Budget. "Britain can become a world trader again through e-commerce. What the Government's done is absolutely fantastic. Let's fly the British flag and get out there," said Mr Williams.