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January 9, 1997updated 05 Sep 2016 12:57pm

VTEL TO ACQUIRE SIBLING COMPRESSION LABS IN $80M TAKEOVER

By CBR Staff Writer

Video conferencing veteran Compression Labs Inc, San Jose is to disappear into Austin, Texas-based fellow videoconferencer VTEL Corp in a transaction valued at over $80m. VTEL is proposing to swap each Compression Labs share for 0.46 of one of its own and VTEL expects to issue about 8.4 million new shares all told, leaving Compression Labs holders with 38% of the enlarged company. The hidden hand behind all this is Intel Corp, which has 10% of VTEL, and a similar stake in CLI. The enlarged VTEL runs a clear second to PictureTel Corp in the video compression industry. The new entity will retain the VTEL name and aggregate annual revenue is running at nearly $200m. VTEL’s annualized sales are running at just under $100m, making it only just bigger than Compression Labs, doing $93.4m over the last four quarters.

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