9 Net Avenue Buy Out Fortifies Concentric Customer Base

Concentric Network Corp. substantially shored up its share of the U.S. Web hosting market Monday by acquiring New Jersey-based 9 Net Avenue Inc.

Concentric (CNCX) is buying 9 Net Avenue for $54 million in stock and cash.

Henry R. Nothhaft, Concentric chairman, president and chief executive officer, the deal will solidify Concentric’s position as a leading Web hosting and e-commerce solution provider for small businesses.

“Our acquisition of 9 Net Avenue reinforces our position as the leading provider of e-business solutions for small- to medium-sized companies,” Nothhaft said. “In particular, 9 Net Avenue brings depth to our Microsoft NT-based Web hosting and e-commerce solutions, a substantial base of hosted customer sites, plus additional engineering and development expertise.”

When the deal is done, Concentric contends the web hosting firm would be the second largest Web hosting provider in the U.S., ahead of freshly-merged EarthLink Network Inc. ((ELNK) and Mindspring Enterprise’s ombined 90,000 Web hosting clients. Nothhaft said that when the acquisition is complete, Concentric’s Web hosting clientele would exceed 104,000 sites.

“This marks a significant milestone for Concentric, as we believe this propels us to the position of second-largest shared hosting provider,” Nothhaft said.

9 Net Avenue is a leading hosting provider offering a wide range of services, including domain parking, UNIX and NT-based Web hosting, e-commerce, dedicated hosting and co-location services. The company operates a data center in Secaucus, N.J., with connections to Tier 1 providers and peering arrangements with top Internet companies.

Concentric plans to integrate 9 Net Avenue’s Web hosting operation into their existing network. Nothhaft said Concentric gains key sales, engineering and marketing personnel in addition to a state-of-the-art data center.

“In addition to gaining East Coast data center capacity and greater critical mass, this deal augments our organic growth,” Nothhaft said.

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