Level 3 Acquires Software Spectrum

Level 3 last week announced the $122 million buyout of Software Spectrum, at a price of $37 per share. Last Wednesday's closing price for the Dallas-based reseller was $16.66 per share.

Software Spectrum will merge operations with Corporate Software, a $1 billion software distributor and services company acquired by Level 3 in March. The boards of both Software Spectrum and Level 3 have approved the acquisition.

The deal is expected to close by the third quarter. Howard Diamond, CEO of Corporate Software, will serve as chairman of the combined company. Judy Odom, current chairman and CEO of Software Spectrum, will serve as CEO. Keith Coogan, a longtime executive at Software Spectrum, will serve as president and COO.

The combination of Level 3's IP bandwidth with the two companies is a strategic move for the Web services era, Diamond said. "It's a good fit," he said. "The future of the industry is focused on .Net software and software by the drink."