P-Com, Telaxis Merger Hits Snag

The merger of wireless telecom equipment makers P-Com and Telaxis Communications has hit a snag.

The deal between the Campbell, Calif., and South Deerfield, Mass., firms was announced in early September and would have
provided Telaxis stockholders 1.117 shares of P-Com common stock for each share of Telaxis common stock.

But citing changes in “business and financial conditions,” the firms said the transaction will not happen by year’s end
as expected, and may not get done at all.

“If a merger of the companies is consummated, it will be on terms different than previously announced and as set
forth in the definitive merger agreement previously signed,” the firms said in a joint statement said.

P-Com and Telaxis are discussing a revised merger agreement, however, no timetable has been set.

P-Com makes wireless telecom products while Telaxis develops wireless fiber-optic connectivity products. The
combined company would offer carriers a full suite of telecom products capable of handling most data rates, radio
frequencies and network architectures, with field engineering services to fully integrate the company’s products.

The
companies saw potential in markets in Latin America, Asia and the Middle East.

It’s unclear what will happen to Telaxis if a new pact isn’t reached. In August, the company hired an investment
banker to help it explore options.

A Telaxis spokesman was not immediately available for comment.

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