Boston Communications Group Inc., a billing and payment-services provider for wireless carriers which was caught in the options-backdating scandal, agreed to be acquired by Indian software maker Megasoft Ltd. for $65 million.
The $3.60-a-share purchase price is an 81% premium to Tuesday's closing price for Boston Communications shares of $1.99. In Wednesday morning trading, BCGI shares jumped $1.41, or 71%, to $3.40 on the Nasdaq Stock Market.
Megasoft is a provider of information-technology software focused on the telecommunications industry.
The acquisition begins a new era for Bedford, Mass.-based Boston Communications, which was a pioneer selling prepaid wireless services such as long-distance phone cards. The company's prospects dimmed following its May 2004 loss in a patent infringement lawsuit to a tiny Phoenix firm, Freedom Wireless Inc. Freedom Wireless had invented a system for tracking minutes of use by people with prepaid wireless-phone plans.
In September 2004, a U.S. judge upheld a $128 million verdict against BCGI -- more than its annual revenue. BCGI agreed to settle the long-running patent dispute last July by paying Freedom Wireless $55 million in damages and unspecified future royalties.
In 2006, BCGI's board began a review of its options dating after an article in The Wall Street Journal highlighted awards to Chief Executive E.Y. Snowden. The analysis found that in seven grants from 1998 to 2002, Mr. Snowden received options dated at the year's lowest close three times, with one of those three tying for the yearly low. Two others were dated at quarterly lows.
Amid the company's review, BCGI saw an exodus of managers that included Mr. Snowden's stepping down as president and CEO and the resignation of finance chief Karen Walker.
BCGI, which had 2004 revenue of $108 million, hasn't filed a quarterly report since the first quarter of 2006 due to its ongoing review of its past option-granting practices.
News From : The Wall Street Journal
0 comments :
Post a Comment