Microsoft co-founder Paul Allen’s personal venture capital company Vulcan Ventures Inc has bought the controlling interest in Nasdaq listed high speed wireless company Metricom Inc (CI No 3,260). Vulcan Ventures said the strategic value of the deal was a result of the company’s exciting wireless technology, which Vulcan wants to take to the national market faster than Metricom can alone. Allen has been investing in the company since 1993, and over time has acquired a 14% shareholding. Now he has offered $56m for a total of 4.65 million shares, 2.583 million shares from the Lindner Group, and the remaining 2.06 million shares from private shareholders within the company, giving Vulcan a 49% stake of the company, and control of the board. Metricom currently operates high speed mobile data networks using frequency hopping spread spectrum technology in the San Francisco Bay area, Seattle and Washington DC. The networks operate on a 902-928MHz frequency which does not require a license from the Federal Communications Commission. The network currently operates at 28.8kbps, and took on eight wireless operating licenses for $1.4m from the Federal Communications Commission in April (CI No 3,151). Metricom plans to introduce a 128Kbps wireless network for introduction in 1998. The company sells both its wireless service and the wireless hardware under the Ricochet name, and it has developed the technology underlying both its Ricochet wireless radio-modem and the network base stations. The deal will be completed only after it has passed antitrust scrutiny from the Securities and Exchange Commission. As a result of the offer Metricom is postponing a proposed $125m bond offering.
