The decision is now in the hands of Digex shareholders who have until September 24 to accept the offer. Digex’s management have recommended that shareholders accept WorldCom’s offer of $0.80 per share, which was upped from $0.70 per share earlier this month.
However, it is a bitter pill for some Digex shareholders to swallow, especially considering Digex stock peaked at $184 per share in March 2000. As of 4.30pm GMT on Wednesday, Digex’s stock was valued at $0.76 per share, which gives the company a market capitalization of $49.6m.
WorldCom owed Digex millions of dollars since it entered bankruptcy protection last year, but now wants to acquire Digex as part of a reorganization plan. WorldCom is trying to rebrand itself as MCI to escape negative publicity from its $11bn accounting scandal, the largest accounting fraud in history.
Source: Computerwire
