Nortel Acquires Alteon for 7.8 Billion
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Nortel will pay an estimated US $7.8 billion in its common shares for Alteon WebSystems on a fully diluted treasury stock basis.
Alteon WebSystems will become a wholly owned subsidiary of Nortel Networks.
The acquisition will enable Nortel Networks to build the next generation Internet data center -- capable of delivering content at unprecedented levels of speed, efficiency, and reliability.
"The value and richness of content across the Internet is increasing on a massive scale," said Clarence Chandran, Nortel's Chief Operating Officer. "Our acquisition will accelerate the delivery of an Internet data center capable of moving content seamlessly and rapidly across high-performance optical, Internet, and 3G wireless networks."
With its massively distributed architecture, robust software capabilities, marquee customer base, deep market penetration, and dramatic revenue growth ($51.5 million for Q2/2000 -- an increase of 82 percent from Q1), Alteon has emerged as a strong player in the expanding market for content switching.
International Data Corporation (IDC) forecasts this market to grow to over $4 billion by 2004 from $203 million in 1999.
Founded in 1996, Alteon WebSystems employs a staff of approximately 500 around the world and is publicly traded on the Nasdaq Stock Market under the symbol ATON.
Its client base includes Yahoo!, Excite@Home, Buy.com, NTT, DLJDirect, CitySearch-Ticketmaster Online, Digex, ISPs UUNet, Cable & Wireless, Virgin, Global Crossing, ICG Communications, GTE Internet, Concentric Networks, and Microsoft WebTV.