Shareholders of STSC, Inc. of Rockville are to vote Thursday on a $24 million takeover offer by Continental Telecom Inc., the Atlanta-based firm that is the third largest phone company outside the Bell System.
Continental is offering $11 a share for STSC, a 13-year-old business that provides remote computing services to some 750 businesses, including more than 100 of the 1,000 largest companies in the nation.
Continental says that if the merger is approved it will keep STSC's operations in Rockville and retain the company's present management, headed by Chairman Daniel Dyer.
The stock buyout would be worth millions to Dyer, 52, and STSC board member Burton Gray, 41, a former vice president of the firm. With more than 8 percent of his company's stock, Gray is STSC's largest shareholder. His 178,000 shares would be worth $1.9 million under the terms of Continental's offer. Dyer holds 6.7 percent of the company, 146,000 shares that would be worth about $1.6 million.
STSC's officers and directors together control 26 percent of its stock. Citicorp, with 145,000 shares worth $1.6 million, is the leading outside shareholder.
The $11 a share offer is more than 150 percent of STSC's $6.95 a share book value, but far short of the $25 to $28 range in which the stock traded late last year and early this year.
STSC's shares dropped as low as $5.25 this year after it reported an unexpected $1.8 million loss for the year which ended May 31. The previous year the computer services company had reported a profit of $1.8 million. STSC officals say they anticipate returning to profitability this year.
Continental Telecom approached STSC about a merger last spring. In May the STSC board voted to take the offer.
The shareholder vote is set for 10 a.m. Thursday at the company's Rockville headquarters.