Tech Industry to buy Paragon for $500 million (Nasdaq: PHCM) said on Tuesday it would buy Paragon Software Ltd. for about $500 million in stock.

Shares in, a maker of software that allows Internet connections through wireless devices, lost 1 1/8 to 137 3/16. The stock has soared since the company's highly successful IPO this year. The company also acquired @Motion Inc. in December to add voice portal technology to its current services.

Shareholders of Paragon, whose technology connects wireless phones to personal computers, will get 3.6 million shares of stock plus $7.6 million in cash. The deal is expected to close in the first quarter of 2000.

Paragon's flagship "FoneSync" product lets users download information such as telephone numbers from software like Microsoft Outlook and Lotus Notes onto their wireless phones.

The acquisition of Paragon Software will improve the company's wireless application protocol (WAP) platform by leveraging the power of data synchronization, the company said.

Paragon has marketing agreements with Nokia Corp (NYSE:NOK), Telefon AB L.M. Ericsson, AT&T Wireless (NYSE:T), Microsoft Corp. (Nasdaq:MSFT) and Lotus Development Corp., a business software unit of IBM Corp. (NYSE:IBM).

-- Reuters contributed to this report.