Lucent Acquires Biller Kenan Systems

Lucent Technologies
Monday said it will acquire billing provider Kenan Systems Corp. in a stock deal worth
about $1.48 billion.

Lucent said it expects the purchase to be finalized by March 31.

Kenan Systems provides flexible billing, order processing and customer
analysis software supporting combinations of services, vendor equipment and
networks. Service providers are able to use one software program to produce
a single customer bill for various combinations of wireless,
wireline, voice, data, Internet and broadband cable services.

Customers of Kenan Systems’ include Internet service providers AT&T Worldnet and GTE Interworking and
broadband cable providers such as @Home
and Videotron. Communications carrier clients include British Telecom, MCI
WorldCom in Britain and France Telecom and emerging carriers such as
Cegetel, Optus, USLEC, GST Communications and Viag.

“The right billing and customer care offering is becoming a passport to
selling integrated solutions in a communications software market expected
to grow 25 percent annually to $26 billion by the year 2000,” said Dan
Stanzione, Lucent executive vice-president and chief operating officer, and
president of Bell Labs.

“We weren’t a player in this space, so we decided to jump to the head of
the pack by acquiring the hottest player in the business. Now we’ll be
providing industry-leading products in a global third-party billing and
customer care market segment that’s growing even faster than the overall
software market.”

Stanzione said the acquisition will further Lucent’s international reach.

“Kenan Systems has deep relationships with incumbent and second carriers
around the world. Its global reputation and sales channels will give Lucent
access to new customers in important world markets,” he said.

Kenan Systems customers outside the United States generate about 40 percent
of the company’s revenues.

“Kenan Systems’ products operate in multi-vendor environments around the
world with minimal need for customization, and can support any size service
provider. They’re a great match for Lucent’s network management and service
creation software, as well as adding value to our hardware/software
offers,” said Lance Boxer, group president of Lucent’s Communications
Software Group.

“We’re also adding deep talent to our software team both inside and outside
the United States.”

Kenan Systems will retain its headquarters in Cambridge, Mass. and will
become a wholly owned subsidiary of Lucent, reporting to the company’s
communications software group. Kenan Sahin will continue as president of
the new subsidiary and also become Lucent vice-president, software technology
Bell Labs.

In other Lucent news, The Financial Times of London, reported
Monday that Lucent is on the heels of finalizing a merger agreement with
Ascend Communications, valued at over $16 billion. Ascend provides
asynchronous transfer mode and Internet protocol routing technology.

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