NEW YORK (AFX) - Singapore-based Internet service provider Pacific Internet Ltd. said Monday its board recommended that its short-term investors accept a sweetened buyout bid by MediaRing Ltd.
PacNet, however, urged medium- to long-term investors to reject the bid.
MediaRing, a Voice over Internet telephony service provider also based in Singapore, raised its offer to buy PacNet by 15 percent to $9.50 per share in cash, or about $127.8 million, late last month. An offer of $8.25 per share in February failed after PacNet's board and Vantage Corporation Ltd. -- which owns about 29 percent of the company -- rejected it.
For short-term investors, the company pointed out that there is no other offer on the table for PacNet; but for long term investors, the company told them to consider its long-term plan to transform itself into an Internet-based communications provider.
In a separate press release Monday, MediaRing said all shareholders should consider the buyout offer.
'We have always argued that PacNet shareholders are faced with a choice between an exceptionally generous offer and an untested business plan, the successful execution of which is subject to risks and uncertainty,' said Khaw Kheng Joo, the MediaRing's chief executive, in a statement.
The revised and final offer expires on July 10.
PacNet's shares fell 18 cents, or 1.9 percent, to close at $9.32 on the Nasdaq. The stock hit its 52-week high of $9.50 last Friday, on June 30.
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