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Case
| HBS Case Collection
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1999
(Revised from original 1999 version)
Metapath Software: September 1997
by
G. Felda Hardymon and Bill Wasik
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Abstract
In September 1997, John Hansen called together his board to debate an interesting choice that his company had to make. Hansen--the CEO of Metapath Software, a provider of software and services to wireless carriers--had two offers to describe. The first was an offer to be acquired by CellTech Communications, a wireless products company which had only recently gone public. Under the terms of the deal, Metapath's shareholders would at closing receive common stock in CellTech valued at $115 million. CellTech at that time had a market capitalization of approximately $260 million. The second offer was from a consortium of investors led by Robertson & Stephens Omega Fund and Technology Crossover Ventures to buy $11.75 million of stock at a $76 million pre-money valuation. The terms of the preferred stock the funds were proposing to buy were much stricter than the terms of the stock owned by existing shareholders.
Keywords: Private Ownership;
Mergers and Acquisitions;
Private Equity;
Decision Choices and Conditions;
Governing and Advisory Boards;
Management Teams;
Stocks;
Public Ownership;
Negotiation Deal;
Telecommunications Industry;
Information Technology Industry;
Citation:
Hardymon, G. Felda, and Bill Wasik. "Metapath Software: September 1997." Harvard Business School Case 899-160, November 1999. (Revised from original January 1999 version.)