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NTT Unit Plans Acquisition of U.S. Web Site Operator

May 08, 2000|From Bloomberg News

TOKYO — NTT Communications Corp., the international and long-distance unit of NTT Corp., on Sunday said it will buy all the shares it doesn't already own in Verio Inc., the world's largest operator of Web sites, for $5 billion in cash.

The NTT unit, which already owns 10% of the U.S. company, will pay $60 a share, 69% more than its closing price in New York on Friday. NTT Communications will make the tender offer on May 17, the company said.

The move comes as NTT's rivals in Japan and abroad form global alliances aimed at enabling them to offer long-distance, local, voice and Internet services through a single provider, analysts say.

"Verio's expertise should add significantly to NTT's portfolio," said David Levy of Chase H&Q. "We think that this acquisition by a large company like NTT would trigger a new wave of consolidations in Internet-related companies."

NTT said it will maintain Verio's brand name and keep its management intact. No layoffs are expected among the 2,000 employees.

Englewood, Colo.-based Verio fell 2.5% to close at $35.94 on Friday in Nasdaq trading.

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