PacifiCare, Compaq Team on Net Venture

PacifiCare Health Systems Inc., which said last week that it would review its dominant role in providing Medicare managed-care plans, said Tuesday that it is teaming with Compaq Computer Corp. to launch an Internet company designed for seniors.

The Santa Ana health-care company, the nation’s largest operator of Medicare health maintenance organizations, will contribute $5 million in cash and assets in the new company, SeniorCo, which is based in Irvine. Houston-based Compaq will put in $14 million in cash.

The companies did not disclose how their stakes in the venture are divided, but PacifiCare, despite its lower financial input, has controlling interest.

SeniorCo has acquired an existing Web site called Senior.com, which offers electronic commerce as well as information on health, faith, travel, financial services, news and entertainment.

As a major player in senior health care, PacifiCare needs to have significant presence on the Internet, said its chief executive, Alan Hoops. The company covers 1.1 million seniors in its Secure Horizons USA Medicare HMO and 3 million members in its commercial plans.

“Through crossover advertising opportunities, we expect to gain brand visibility,” said Hoops, who is scheduled to step down from his job soon. “Over time, we expect that this brand awareness will give us access to the senior market that we wouldn’t be able to achieve efficiently otherwise.”

Both investors will have a major presence on the expanded Web site, which soon will link to PacifiCare’s site and will include an online store carrying Compaq products.

Senior.com also is expected to generate revenue for PacifiCare and Compaq through online advertising, commissions and marketing fees from other businesses that pay to include links to their Web sites.

PacifiCare shares jumped $2.38 to $58.38 on Nasdaq, and Compaq shares rose 50 cents to close at $27.88 on the New York Stock Exchange.