The share price for the Perion Network Ltd had its largest decline in more than three years as its investors were disappointed with the lack of a premium for its merger with Conduit Ltd's Client Connect business.

The Tel-Aviv based Perion creates desktop programs for emails, photo sharing and web security fell by 15% since March 2010 to about ILS40.83 per share. Conduit on the other hand is a creator of community toolbars and mobile applications.

The merger between the desktop programmer and toolbar developer is an all share transaction and would still require approval from the shareholders of Perion as well as customary tax and regulatory filings. Last July in a report by business daily TheMarker, Conduit said it was in advanced talks to acquire Perion for USD200 million, a price that had a 46% premium at that time. 

Included in the deal would be Conduit shareholders obtaining 81% of the new company and Perion shareholders retaining 19%. Using figures reported as Perion's market capitalization by Bloomberg calculations at USD159 million as of Sept.13, the newly merged company would be worth USD837 million.