May 2, 2002 -- (WEB HOST INDUSTRY REVIEW) -- Internet communications and services firm Level 3 (Level3.com) said today it has signed a definitive agreement to acquire Software Spectrum, Inc., a provider and reseller of business software, in an effort to penetrate the software distribution business.
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Under the agreement, Software Spectrum shareholders will receive $37 per share in cash and merge with a subsidiary of Level 3 Communications. The merger, which is subject to approval by at least two thirds of Software Spectrum shareholders, is expected to close in the third quarter of 2002.
Shares in Software Spectrum surged on the news, gaining almost 20 dollars, or 117 percent, in trading Thursday morning. Shares in the company closed at $16.65 Wednesday.
Software spectrum provides a suite of IT-based enterprise software management and contact center solutions. The company, which has offices worldwide, generated revenues of approximately $1.3 billion last year.
"Over the past few months Level 3 has moved to significantly expand its information services business," said James Crowe, Level 3's CEO. "We are doing so in order to take advantage of important economic and technology trends, including the continuing convergence of the broadband and software distribution industries."
