The San Francisco Examiner from San Francisco, California • 79

Friday, June 28, 1 996 F-l Markets at a glance Change from previous trading clay's close nfjP jpp Is your cold stock getting hot Find out by calling CityLine at (415 1 510 1 408) 808-5000. Enter 9000 for market info. Enter 9525 for Stock quotes. This is a free call in the local San Francisco, Oakland and San Jose calling areas. Mi IF IP II 1U jpjj NYSE 6 AMEX 7 NASDAQ 8 MUTUALS 9 mgfiaDDKSrS i 30-year Treasuries, New York close 6.9096 mi Arkansas chain snags 2 Federated sites, planning more acquisitions By Wendy Tanaka OF THE EXAMINER STAFF An important new player will join the California retail game next 1 ft By Tom At te EXAMINER TECHNOLOGY WRITER If year when giant Dillard Department Stores Inc.

of Arkansas is expected to open stores in Stockton, Santa Rosa and perhaps other cities. The Little Rock-based department store chain, the nation's third-largest behind the Federated and May Co. chains, plans to convert an existing Weinstock's store in Stockton's Weberstown Mall into a Dillard's. It is also in final negotiations to cilities around the world to give their top creative people a chance to experience, in the virtual sense, pro i 1 111, if' take over a Macy's store in Santa Rosa and is reportedly looking for other sites in the Bay Area and other parts of the state, industry analysts said. The move allows Dillard's an entrance into California's lucrative retail market, analysts said.

"It gives them a toehold in the Golden State," said Alan Millstein, editor of Fashion Network Report, an industry publication. That toehold appears to be con Graphics' brain force, 1 Mm 30 industrials, Friday close vs. Japanese yen, New York late 109.59 0.47 5,654.63 KQED sells print group KQED the public broadcaster that recently sold off its monthly magazine San Francisco Focus, has sold the last of its print divisions, KQED Books Video, producer of companion volumes and videos of KQED-TV's cooking shows. The sale, for an undisclosed sum, went to Windmere Corp. of Miami Lakes, Fla.

In a statement, Windmere said it intended to produce companion items to PBS shows with KQED and other public TV stations. The sale is the latest piece of the multimedia company, which operates Channel 9 and 883 FM radio, to be unloaded. Cash-strapped KQED also recently renegotiated bank loans on its $19 million Mariposa Street studios to get more generous terms for repayment. ZDTV show to run on MSNBC at night ZDTV, a division of Ziff-Davis Publishing has announced a nightly prime-time time slot for its forthcoming TV show, "The Site." "The Site" will premiere on MSNBC, the new cable network, and use the resources of NBC News, Microsoft Corp. and the Ziff-Davis print magazines to cover the social and economic aspects of digital technology.

The one-hour show, to air on weekdays with highlights on weekends, will be produced by former Chronicle Broadcasting Co. executive Richard Fisher from a studio at 535 York St. "The Site" becomes the third made-in-San Francisco TV show about computers and hightech, joining "CNet Central" and "Cyberlife." Pacific Gateway soars on takeover proposal Pacific Gateway Properties Inc. shares rose 13 percent Friday on news it received a proposal to be acquired for $5 a share in cash. Pacific Gateway, a San Francisco-based office building developer, said it reported 3.9 million common shares outstanding for the quarter ended March 31.

The company said it is in discussions with the bidder to obtain clarification of certain elements of the proposal. The name of the bidder wasn't disclosed. Pacific Gateway earlier this week reported the termination of a letter of intent with another party to buy up to 50 percent of Pacific Gateway at $5.05 a common share. An hour before Friday's close, Pacific Gateway stock was up Vs at 4 a share on the American Stock Exchange. Visx, Summit named in price-fixing suit Shares of Santa Clara-based Visx Inc.

tumbled 11 percent after a joint venture the company has with Summit Technology Inc. was sued on charges the companies fixed prices on their laser systems used to treat nearsightedness. Visx rebounded Friday, gaining lVfe by late afternoon, after falling 4Vs to 31 Thursday. Shares of Massachusetts-based Summit, which has a smaller stake in the joint venture, fell Vi to 14 Thursday, and dropped another Vfc late Friday. The suit, brought by San Francisco's Alioto Alioto law firm on behalf of a Texas eye doctor, challenges a $250 royalty doctors must pay to the joint venture, Pillar Point Partners, each time they use one of the lasers.

Visx gets 56 percent of the payment, and Summit gets 44 percent, under the partnership. The companies currently license the lasers to ophthalmologists to treat nearsightedness. Los Angeles-based Hapsmith the development company that owns the Stockton mall, confirmed Dillard's entrance into his center. "Dillard's will revitalize the whole mall," he said. "Well be able to fill up our mall with (women's apparel retailers) we haven't been able to attract before." Dillard's with sales of $5.5 billion in 1995 operates 245 See DILLARD, F-3 eteiiiet mm Excite Inc.

joins forces with troubled McKinley Group By Tom Abate EXAMINER TECHNOLOGY WRITER The crowded Internet search field is beginning to narrow, with Excite Inc. of Mountain View agreeing to acquire the troubled McKinley Group Inc. of Sausalito in a stock swap worth about $10 million at Thursday's closing price. Calling from an airphone, Chief Executive George Bell said the deal, the details of which have yet to be ironed out, would give Excite the second most heavily trafficked search site on the Internet, after the Yahoo! Inc. site.

"This is a space in which consolidation is inevitable," Bell said. "If you can be the aggressor, you can pick your partners and gain ground at a reasonable price." Keith Benjamin, with Robertson Stephens in The City, said the merger, if completed, would let Excite absorb about $5 million in revenues McKinley would earn in 1996, along with 40,000 Website reviews and a marketing presence in Europe. "With this deal Excite will be neck-and-neck with Yahoo! in revenues, but it has a market price only one-fifth as high," Benjamin said. Bell said executives from Excite and McKinley had not yet decided how to merge the two operations, and did not know how many layoffs might result. Bell said McKinley had about 75 people, including a 10-person engineering team, that Excite was eager to acquire.

Less certain was the status of McKinley's editorial staff, which reviews Websites. Bell said Excite had an 82-person staff See MERGER, F-2 coming courtesy of rival Federated Department Stores which owns the Weinstock's and Macy's stores in question. Federated has been seeking buyers for several stores partly at the order of federal antitrust officials since purchasing the Macy's and Broadway chains over the past two years. Neither Dillard's nor Federated officials would comment Thursday. But Fred Nicholas, president of had fled in the swnanum screen, top, powered by Silicon Graphics computers, can depict a realistic panorama.

Special chairs, above, allow occupants to "drive'' a space vehicle. PHOTOS COURTESY OF SILICON GRAPHICS ii il 1' "i I yi t- Ttf1 I XPERIENCING Silicon Graphics new virtual is ality studio compares favorably to riding a roller coaster in your living room. jects that might cost billions to build. "These are becoming the decisionmaking centers in a few forward-looking organizations," McCracken said. As an event, the press conference christening the Visionarium was high on glitz and low on news, allowing Silicon Graphics to beat its own drum after a year in which Wall Street has hammered its stock.

Indeed, McCracken's day started on a sour note when San Francisco's morning paper, quoting unnamed sources, reported that 600 engineers, a fifth of Sili last rune months, endangering its lead in visual computing. "It is really completely inaccurate, both in the numbers and the link to graphics," McCracken said. "The Chronicle was off by a factor of four." Human relations chief Ken Coleman said 150 engineers had left Silicon Graphics in the last nine months, a turnover rate far lower than 20 percent, with most of the departures coming from Internet groups, as engineers drifted off in search of stock options at Silicon With a huge, curved screen that literally wraps around a room, and perfect acoustics to immerse viewers in the sound of the event, this $3 million private screening room is not likely to be a consumer item any time soon. But Silicon Graphics Chairman Ed McCracken said Thursday that corporate executives were already building or renting about a dozen "Visionarium" fa re has no plans for more price controls and is in fact moving the other way. Nationwide, rates have jumped from 3 percent to 26 percent this year, affecting millions of customers.

In the Bay Area, Tele-Communications Inc. has followed suit. The primary local cable provider points to programming increases and inflation as the cost culprits. "The rate increases that TCI put into effect in June average 9 percent acrofisi the Bay Area," said for cfibiQ mte Banana Republic rumored to be expanding S.F. store Valerie Castellana, director of communications and government affairs for TCI-Northern California.

"That covers inflation and increases in programming. Under FCC rules, we're permitted to adjust our rates once a year." Despite the soaring prices, cable firms and the FCC insist that customers are being protected from rate gouging and are benefiting in many cases by receiving additional channels. The government, they say, sim-. See CABLE, F-2 Despite increases this year, Congress isn't interfering FROM EXAMINER STAFF AND WIRE REPORTS The last time cable TV rates jumped up by double digits, Congress ordered them brought down. This time, with nationwide rates climbing as much as 26 percent since January, customers probably are ot of luck: Congress double its current size, real estate sources say.

The sources say the company is seeking to expand into a portion of the former White House department store space on Sutter Street. That space is around the corner from Banana Republic's store at 256 Grant which is already the largest in the 190-store chain owned by retail giant Gap Inc. See BANANA, F-2 Would grow into White House site By Mandy Behbehani OF THE EXAMINER STAFF Banana Republic, the San Francisco-based casual clothing chain, is negotiating to expand its store in the Unioi Square area to almost.