TelePacific acquires Tel West, Telekenex and OCiX

Top M&As 2011Deal sizes: Undisclosed

Why are these deals relevant? TelePacific's three summertime acquisitions were geared not just to help it grow in the currently trending data center and managed services space, but also to maintain competitiveness against the incumbent carriers AT&T (NYSE: T) and CenturyLink (NYSE: CTL) in its primary region of southern California and Nevada.

Its acquisitions of Telekenex in May and both Tel West and Orange County Internet Exchange (OCiX) in June were key pieces of the Los Angeles-based CLEC's growth strategy for 2011.

Acquiring Telekenex gave TelePacific an instant presence in the San Francisco and Seattle markets, along with 1,000 business customers, but perhaps more importantly the provider gained network miles including a nationwide PCI compliant MPLS backbone and a fiber network running between San Francisco and Oakland. Telekenex's hosted PBX platform and managed services were added gems in the deal.

Fast on the heels of that coup was its deal for Tel West, an Austin-based service provider whose 3,400 business customers included SMBs, enterprises and government agencies. More importantly, it gave TelePacific a foothold in the Texas market, one which saw 20 percent population growth and 15 percent business growth in the past decade. Adding Tel West's portfolio also boosted the CLEC's nationwide footprint among business customers.

"TelePacific currently serves deep and dense population centers in California and Nevada and with the addition of Texas will cover approximately 20 percent of the small and medium businesses in the U.S.," said Lars Haegg, managing director at Investcorp, one of TelePacific's two main shareholders.

The June purchase of OCiX was the third step in TelePacific's acquisition waltz, giving the provider a 10,000-square foot SAS 70 Type II certified data center located in Santa Ana, Calif., in the CLEC's home region. It was a move that fit in with its colocation growth strategy, evidenced by its 2010 acquisition of 01 Communications in Sacramento and its building of data centers in San Francisco, San Jose, Los Angeles, San Diego and Las Vegas.

While TelePacific CEO Dick Jalkut told FierceTelecom in November that the company was not looking at additional acquisitions in the near future, the company secured $50 million in new funding in May for both corporate and to fund additional deals as the opportunities arise.

TelePacific acquires Tel West, Telekenex and OCiX