SBC Communications Inc. offered to acquire the remaining 58% of Internet service provider Prodigy Communications Corp. for $384 million, or $5.45 a share.
Shares of Austin, Texas-based Prodigy had closed up 2 cents at $3.54 on Nasdaq, before the offer was announced.
SBC and Prodigy said in November 1999 that they would combine their Internet businesses. Prodigy issued 49 million new shares, then valued at about $1.6 billion, giving SBC a 43% stake.
In return, SBC, parent of Pacific Bell, agreed to make Prodigy the exclusive Internet access provider for households and small businesses in its service area of about 100 million people. The transaction was completed in June 2000. SBC’s stake in Prodigy dropped to 42% after Prodigy bought FlashNet Communications Inc.
Shares of San Antonio-based SBC fell $1.65 to close at $44.25 on the NYSE.