SBC to Buy 4% Stake in Concentric Network

SBC Communications Inc. said it will buy 4% of Concentric Network Corp. for about $21.9 million as part of an agreement to sell Concentric’s Internet-based data services to SBC’s business customers. SBC, the No. 2 U.S. local phone company and parent of Southwestern Bell and Pacific Bell, plans to buy 906,000 shares either for $24.15 each from Concentric or on the open market. SBC will have the option to buy another 4% within three years at $21 a share. Cupertino-based Concentric shares fell 31 cents to close at $20.81 on Nasdaq. SBC shares rose 69 cents to $42.88 on the New York Stock Exchange. Under the agreement, San Antonio-based SBC will provide the local network that links customers to Concentric’s nationwide network. Concentric will provide the long-distance connection because SBC can’t provide long-distance to its local customers under government rules. Also Tuesday, SBC asked the U.S. Supreme Court to void restrictions that keep the Baby Bell telephone companies out of the $70-billion long-distance phone market.