Divine's debut draws wait-and-see reaction 

By Rick Hepp 
Tribune Staff Writer 
July 12, 2000 
Chicago Tribune

Fifteen years ago, Garey Coonen went public with Encore Computer Corp., a technology company that
made parallel processing system that allowed computersto perform many tasks at once. 

"At the time it was a state-of-the-art product," he said. "Nowadays, the company doesn't exist anymore. The
stock never got up to the point that it was initially when it was offered." 

Now with a business-technology solutions company in Lincolnwood, Coonen said he hopes the same fate
won't befall Divine Interventures Inc., which went forward with its initial public offering of stock
Wednesday after delaying it seven times. 

The Lisle-based firm priced its offering of 14.3 million shares at $9. At the end of trading Wednesday, Divine
stock was down 22 cents, or 2.43 percent at $8.78 on a volume of 7,633,500 shares. 

"Instead of a white horse, it was a gray horse," Coonen said. "They've chosen a difficult time to go through this,
so the key will be whether they can weather the trends that seem to be in the marketplace right now. The key is
what value they bring to the marketplace." 

That wait-and-see attitude was echoed by other Chicago's dot-comers, who, like Coonen, were
attending this year's Internet World e-business convention at the Hyatt Regency Hotel. 

"It's just that the market is not as hyped to the core business as they thought," said Ossie Bailey, a vice
president at Comdisco. "After the revaluation of the market, companies are now being looked at more from
a value proposition as opposed to a fascination with an Internet space. 

"I think that business sanity is being brought to the table," he said. 

Divine, a so-called incubator that has a stake in 52 Internet start-ups, initially filed for an IPO in December,
hoping to raise as much as $460 million. It had to greatly reduce its asking price after Internet stocks tumbled this spring. 

In addition to its public offering woes, Divine's rapid growth slowed earlier this year. It was forced to lay off
29 employees in May and delay construction on its 400,000 square-foot headquarters campus at Goose
Island, which originally had a move-in date of this fall. 

"I think that the challenge for Divine will be to show investors, now that they are a public company, that they
really do know how to build value and deliver on what they have promised," said Darcy L. Evon, the president
of I-Street Inc., a company that covers the local technology scene and is in partly owned by Divine. 

While she points to companies like her own in the Divine fold that are starting to bring in revenue, Evon said,
"There's a lot of companies that have no promise and it doesn't matter what Devine's services are because on an
average only about 20 percent of start-ups make it." 

Evon said Divine needs to grow its core business. It needs to develop the promising companies it already has
investments in, plus it has to purchase companies undervalued in the marketplace and start to bring traditional companies online.

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