Neutral Tandem (Nasdaq: TNDM) reached another major milestone in becoming a global Ethernet provider with the completion of its acquisition of Italian-based IP/Ethernet wholesale provider Tinet SpA.
Although Neutral Tandem has already established its own Ethernet exchange via its U.S.-based nationwide network that was originally designed for voice termination, the acquisition of Tinet, which becomes a subsidiary of Neutral Tandem, will enable the service provider to deliver both wholesale voice, but also Ethernet to other carriers that need interconnection to expand their respective Ethernet footprints.
To purchase Tinet, Neutral Tandem paid about $99.8 million in cash, which includes purchase price adjustments and the assumption of cash and long-term debt.
One of the key elements of the Tinet acquisition is that it includes 15 established External Network to Network Interconnection (E-NNIs) arrangements with various global carriers. These E-NNIs will augment Neutral Tandem's ongoing build out of its own Ethernet exchange, an element that will allow carriers to fill in their Ethernet coverage gaps through a neutral solution that simplifies Ethernet interconnection process they conduct with wholesale service provider partners.
Global connectivity is the name of the game with this acquisition, explains Rian Wren, President and CEO of Neutral Tandem. "We believe that this deal will allow us to leverage our core competencies, expand our global footprint, accelerate our Ethernet initiatives and move beyond voice into data solutions," he said in a release announcing the completion of the deal.
- see the release here
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