SBC Bolsters E-Business Plans With $3.9 Billion Sterling Commerce Acquisition



Telecommunications carrier SBC Communications Inc. today advanced plans to become a player in the business-to-business E-commerce market with the $3.9 billion acquisition of Sterling Commerce Inc., a supplier of E-business software and services.

SBC says the deal will help it develop a strong presence in the business-to-business market by incorporating Sterling Commerce's e-Marketplace products and consulting services into its portfolio.

Sterling Commerce brings to SBC its expertise in developing software that lets enterprise customers build online marketplaces where they can buy and sell products and share information. Sterling, which serves 487 of the Fortune 500 companies, says SBC's branding and marketing power will help it attract new business customers.

Under the terms of the all-cash deal, SBC will pay $44.25 per share for all outstanding shares of Sterling Commerce stock. When the acquisition closes in March, Sterling Commerce will become a subsidiary within SBC's Global Markets group and will continue to operate out of its Columbus, Ohio, headquarters.

SBC said an acquisition was the most feasible way to get the technology and skills its E-business customers are requesting. "The alternative to acquiring Sterling Commerce would be to build a significant E-business presence on our own, and that would be difficult, expensive, and could take several years," says Steve McGaw, SBC's managing director of corporate development.

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