Prodigy Services Co. starts a new life on Monday, with a new owner and a strong emphasis on international growth.
Prodigy on Sunday announced its acquisition by International Wireless, a communications company with a range of investments, and Prodigy management, including Ed Bennett, the company's president-CEO. Joining as a financial and strategic partner is Grupo Carso, a Mexican telecommunications company.
Terms of the transaction weren't disclosed, although an executive close to the company said the price tag was about $250 million, well below the $1 billion-plus invested by Prodigy's previous owners, IBM Corp. and Sears, Roebuck & Co.
About 40 Prodigy executives comprise the buyout team, some of whom have invested their own money. Prodigy's senior management includes Will Lansing, exec VP-chief operating officer; Barry Kluger, senior VP-communications; Josh Grotstein, senior VP-content; Scott Danielson, senior VP-general manager, design; Marc Jacobsen, general counsel; Gerry Mueller, exec VP-general manager, Internet Services Group; Randolph "Chip" Austin, VP-general manager, Internet access; and David Friedensohn, general manager-Wildflower Partners Fund.
Prodigy plans to continue in its current direction under the new ownership, said Mr. Kluger. The company's first priority is to continue migrating to an Internet platform.
"We're still continuing along the line of using the studio model of creating great content," Mr. Kluger said. "Speed, access, games, chat remain a focus."
He said Prodigy will continue to offer access service, although discussions are under way with International Wireless over how best to use that company's strengths. International Wireless, a closely held private company, has stakes in cellular, online and Internet content development companies. Grupo Carso, which owns a stake in Mexican telephone company Telefonos de Mexico, is a major shareholder in International Wireless.
Mr. Kluger said no additional layoffs are planned; Prodigy laid off 117 people, about 15% of its staff, earlier this year.
Contrary to previous indications, however, Mr. Kluger said Prodigy will not move its operation to the SoHo area of New York, where Mr. Bennett has his main office.
"Everything has existed quite well between New York and Whitel Plains," Mr. Kluger said. "No major moves are planned."
Copyright May 1996 Crain Communications Inc.