Birch Communications makes 17th acquisition with Covista purchase

Birch Communications on Wednesday signed an agreement to acquire Covista Communications, marking its 17th acquisition since 2006.  

Financial terms of the acquisition were not revealed.

Covista is a facilities-based competitive telecom provider that provides services to a mix of business, wholesale and residential customers in 48 states.

By buying Covista, Birch will gain access to customers that reside in a number of several southeastern, southwestern and northeastern states.

Vincent M. Oddo, Birch President and CEO, said in a release announcing the acquisition that "Covista's Metaswitch-based facilities network, which has switching centers in Tennessee, New York City and Los Angeles, is complementary to our current service footprint while also adding some new markets."

Besides expanding the reach of Birch's own IP network, the Covista purchase will complement its line of hosted PBX, SIP trunking and wholesale service offerings, which were launched in 2012.

Joining a group of private equity firms and other aggressive competitors like Zayo, Birch has become one of the key consolidators of the competitive telecom market.

Similar to other acquisitions that Birch has made in recent years, the Covista purchase once again reflects the CLEC's "tuck-in" strategy that searches for opportunities to purchase other service providers that offer similar services and geographic coverage.

After purchasing Cordia in Oct. 2011, Oddo said that the service provider would purchase other competitive carriers it thought would bolster its IP-based services strategy.

Keeping to that promise, last year Birch purchased both DayStar Communications and AstroTel, two acquisitions that immediately increased its presence in the Florida market. These acquisitions came not long after it secured $110 million in a refinancing effort in addition to a $7.5 million equipment financing deal with CIT Vendor Finance.

With plans to continue expanding its IP network in new markets and broaden its managed telecom and IT solution sets, it's likely that Birch will be making other acquisitions that complement its network footprint and service focus.

For more:
- see the release

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