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DSP, Proxim Cancel Planned Merger

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Times Staff and Wire Reports

DSP Communications Inc. and Proxim Inc. said they agreed to terminate their planned merger because of a recent drop in their stock prices. The companies said they will instead pursue a working partnership to develop and market products for wireless communications. Cupertino, Calif.-based DSP recently expanded into wireless PBX equipment, which allows phone communications with workers roaming inside buildings. Mountain View, Calif.-based Proxim’s wireless technology is used for applications such as allowing doctors to communicate in hospitals with laptops. When the stock swap was announced Oct. 29, DSP shares plunged 33%, and Proxim shares fell from a recent high of $23.25 on Oct. 30 to $19.625 Friday after falling 12.5 cents. On Friday, DSP shares gained $2.75 to $40.75 on Nasdaq.

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