KING OF PRUSSIA, Pa. (AP) — InterDigital Inc.'s board of directors has ended a review of a possible sale of the company and concluded that the wireless technology developer should pursue more patent sales and licensing deals.
Investors who bought up InterDigital shares when they thought it might be sold appeared to cut their losses after the company' announcement on Monday. Shares tumbled more than 16 percent in aftermarket trading.
InterDigital's board spent six months reviewing strategic alternatives, including selling the company. But a buyout offer for the whole company never materialized.
Now the board believes the company should beef up its effort to turn its patents into money makers.
In a statement, InterDigital Chairman Terry Clontz said that going through the review process helped reaffirm the board's belief in the company's patent portfolio, research and development team and other assets.
Patents on wireless technology are a hot commodity now as the smartphone market heats up and rivals sue each other over competing designs.
As of Dec. 31, InterDigital's had more than 19,500 wireless patents and patent applications.
Last summer, speculation that InterDigital was being targeted for takeover by Google Inc. sent its shares through the roof. But that dissipated a few weeks later, when Google moved to buy Motorola Mobility Holdings Inc., itself an owner of thousands of patents on wireless technology.
Meanwhile, InterDigital said that it expects net income for the three months ended Dec. 31 to be $21 million, or 46 cents a share. It also anticipates revenue will be $74.2 million.
InterDigital's shares ended regular trading down $1.52, or 3 percent, at $44.45 before the announcement. The stock plummeted another $7.16 to $37.29 in aftermarket trading.