H&R; Block Plans To Spin Off Compuserve
After months of pressure from shareholders who felt its stock was undervalued, H&R; Block Inc. announced Tuesday it would spin off its CompuServe Inc. on-line services company.
Block said it will make a public offering of less than 20 percent of CompuServe stock in April. It will distribute its remaining ownership through a tax-free spinoff or splitoff within about a year.
CompuServe would become the second stand-alone on-line services firm. The other is its larger rival America Online Inc., which has seen its stock triple in value in the past year.
Kansas City-based Block, the nation’s largest tax preparation service, also reported a loss of $5.5 million, or 5 cents per share, for the quarter that ended Jan. 31. Revenue rose 16 percent, to $312 million from $268 million.
Block said the loss resulted from heavy spending at CompuServe in new marketing programs and expansion, including development of a second on-line service.<