The head of a Greek listed company could not believe how he had lost the chance to acquire the largest Cypriot Internet service provider. He had agreed with the Archdiocese of Cyprus, the owner of LOGOS-Net, to buy a 51-percent stake in the company. However, when he reached the archbishop’s office, check in hand, he was told that the deal was off. A few days later, it became known that Yiannis Markopoulos, formerly the main shareholder of Sigma Brokerage, had acquired LOGOS-Net for a sum three times higher than what the first businessman had offered. Markopoulos wanted to make LOGOS-Net public immediately, listing it on the Nicosia Stock Exchange, which, like its Athens counterpart, was going through its glory days in 1999. Things, of course, did not work out as expected. In another case, Cypriot firm LK Globalsoft – a company related to AremiSoft, whose main shareholders are facing securities fraud charges – paid more than a billion drachmas to acquire a Bulgarian infotech company with nonexistent turnover. Lykourgos Kyprianou, LK Globalsoft’s owner, had also acquired a stake in a Greek company: a few months later, the latter’s owner fortuitously met Kyprianou’s would-be Bulgarian partner who had chartered a luxury yacht for a three-month cruise around the Greek islands. The dramatic downturn in the stock market in Greece and Cyprus laid waste to the plans of Markopoulos, and those of dozens of other businessmen and investors who spent billions of drachmas on buying New Economy firms, dreaming of earning huge profits from their listing. During this period of the Internet paroxysm, a wide range of businesses were involved: banks, insurance firms, brokerages, even construction companies and marble firms. Backwardness limited losses Very few of those who spent exorbitant sums of money on small Internet firms made any profits. However, Greece’s relative underdevelopment in new technologies spared banks, venture capitalists and other institutional investors from worse losses. In Europe, their counterparts have lost tens of billions of dollars. Worst hit in Greece were certain publishers. The previous management of the Commercial Bank of Greece spent about 400 million drachmas on acquiring a 25-percent stake in the IPNG Group. The latter tried to import into Greece the free Internet access model (with large numbers of advertisements to be endured by the subscribers). After two years of operation, IPNG was liquidated. Still, banks are relatively less exposed to New Economy investments, despite the fact that their venture capital arms invested in this sector. The Info-Quest information technology group was one of the heavy investors in the New Economy, through investments in venture capital firms and incubators abroad (in the USA, Israel and the UK). Some of those venture capital firms have been liquidated, while an AremiSoft share is worth about $0.50, down from $19 in spring 2001. According to Info-Quest management’s calculations, these unhappy investments resulted in a shrinking of its equity capital by 8 billion drachmas to 52 billion by September 30. The Ideal group had also invested in the New Economy, buying small Internet service provider Acropolis.net and portal iBoom. Acropolis.net has been liquidated, while iBoom, which had announced its intention to build a global portal for Greeks here and abroad, is down to four employees. Now, most market insiders believe that better days for technology companies are far off, despite earlier predictions of a recovery in the first quarter of 2002.