SANTA CLARA, Calif. - Shares of Macrovision and Gemstar plunged yesterday as investors soured quickly on a deal that would have the media-technology company buy out the television-listings business for $2.8 billion in cash and stock.

Macrovision Corp. wants to allow consumers to call up information about television shows, view personal photos, or access music libraries on a variety of electronic devices through a combination of its security software and Gemstar-TV Guide International Inc. programming data. Macrovision develops technology to prevent unauthorized copying and viewing of video, music and other content.

"There is a transformation of home entertainment going on, and we want to give consumers the ability to find information quickly and easily across a variety of devices," Macrovision chief executive officer Fred Amoroso said.

Wall Street apparently did not like the matchup, sending Macrovision shares down 21.4 percent, or $5.55, to $22.44. Gemstar shares did not fare much better, falling 16.6 percent, or 99 cents, to $4.99.

Amoroso did not disclose plans for Gemstar-TV Guide's print operations, saying he would need time to understand that business before making decisions.

Gemstar-TV Guide employs 1,600, including 300 at its publishing group and interactive-program-guide group offices in Radnor.

The company's flagship magazine has struggled with falling circulation and advertising revenue as viewers increasingly access programming data through their television sets or online.

Gemstar-TV Guide shareholders will receive $6.35 in cash or 0.2548 of a share of common stock in a new holding company that will own both Gemstar-TV Guide and Macrovision. The cash component of the deal will not exceed $1.55 billion.

The $6.35-a-share value represents a premium of 6.2 percent to the Gemstar closing price Thursday. It is 25 percent above Gemstar's closing price before it announced a strategic-alternatives review July 9.

In a filing with the Securities and Exchange Commission, Macrovision said it would raise $800 million of new debt to finance the acquisition.

The board of the television-media company has unanimously approved the transaction, which is expected to close by the second quarter of 2008. Rupert Murdoch's News Corp., which owns about 41 percent of Gemstar-TV Guide, has agreed to vote in favor of the deal.

Macrovision stockholders will continue to own one share in the new company for each share held at closing. When the deal is completed, Macrovision shareholders will own about 53 percent of the combined company, and former Gemstar-TV Guide stockholders will own 47 percent.

Amoroso will continue as president and chief executive of the new company. Macrovision's chief financial officer, James Budge, will serve as CFO. The new board will include four directors designated by Macrovision and three chosen by Gemstar-TV Guide.

Gemstar-TV Guide CEO Rich Battista and CFO Bedi Singh will leave when the deal closes.

JPMorgan Chase & Co. served as financial adviser to Macrovision. UBS Investment Bank was financial adviser to Gemstar-TV Guide International.

Macrovision, of Santa Clara, Calif., has about 760 employees and reported revenue of $248 million for fiscal 2006. Gemstar-TV Guide posted 2006 revenue of $571 million.

GemStar and TV Guide Inc. combined in 2000. The company restated millions in revenue after its former CEO, Henry Yuen, was found guilty in 2006 of securities fraud for inflating revenue between 2000 and 2002. News Corp. took an $11.1 billion write-down for its Gemstar-TV Guide investment in 2002.