Under the terms of the agreement, Sovintel will route Internet voice and fax traffic over the iBasis Network, an international network for Internet telephony. Additionally, iBasis will shift international traffic from its global network onto Sovintels fiber-optic digital network.

"Sovintel has a commitment to quality that has enabled them to become an important player in the Russian telecommunications market," said Ofer Gneezy, president and CEO of iBasis Inc. "The agreement with Sovintel will provide our customers direct, reliable connections to the important business centers of Moscow and St. Petersburg, the two cities that have become the hubs for Russian international commerce."

"iBasis is a proven global provider for many of the world's largest carriers," said Alexander Vinogradov, general director of Sovintel. "I am sure that our cooperation with iBasis will complement the high quality of service our customers have come to expect. By connecting to iBasis, we can efficiently extend the reach of our international services."

iBasis was founded in 1996. More than 70 international carriers are iBasis customers including 11 of the top 12 U.S. telco companies.

Founded in 1990, Sovintel is jointly owned by the Russian national carrier, Rostelecom, and the American company, Golden Telecom (GLDN). Sovintel provides advanced voice, data, IP and video telecommunications services based on its own fiber-optic network.

Shares of iBasis rose 1.938, or 7 percent, to 30.688 at mid-day.