Telephone company GTE plans to acquire one of the oldest Internet service providers, BBN, in a $616 million deal. The agreements ends, once and for all, persistent speculation about a rival bid from AT&T.
The takeover - announced on the same day that BBN reported a net loss of $12.2 million for its third quarter ended 31 March - is subject to government approval. GTE president Kent Foster said: "GTE will jump start its entry into the enhanced Internet services market for large businesses through the acquisition of BBN."
The deal puts an end to discussions between BBN and AT&T, which is a minority shareholder in the ISP, about the possibility of a merger. The two companies are now in discussions about disputes over their Internet services agreement.
If the takeover is given government approval, GTE will pay $29 a share to acquire all BBN outstanding common stock. Remaining BBN shares not owned by GTE will be converted to cash. BBN helped built Arpanet, the predecessor to the Internet, and operates a number of networking projects on behalf of the US government.
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