Redback Heads North

Redback Networks Inc. Monday struck a deal to acquire Canada’s Abatis Systems Corp. for $636 million in common stock.

Redback , a provider of advanced networking systems, is banking that Abatis’ service creation and management tools will be the key components it needs to drive service deployment of its “new access network” by cutting the cost and complexity of installation. Redback said the new access network is a unified, highly efficient infrastructure for provisioning and managing subscriber services across network layers. The model is intended to simplify network operations and service delivery while enhancing network reliability and performance.

Under the terms of the agreement, already approved by the boards of directors of both companies, Redback will issue 5.2 million shares for all shares, options and warrants of Abatis. Abatis will become a subsidiary of Redback and Abatis Chief Executive Officer John Seminerio will become general manager of the subsidiary, reporting to Vivek Ragavan, president and chief executive officer of Redback. The transaction is expected to close in the fall.

“The union of Abatis Systems’ and Redback Networks’ technology gives rise to a self service provisioning model for the New Access Network that has significant operational cost savings and revenue generating benefits,” Ragavan said.

Abatis Systems’ service portal allows business or consumer subscribers to select and pay for IP services from a carrier, ISP or ASP through a graphical interface. The service portal utilizes standards-based XML and is layered with a “network aware” service manager that can understand the topology and performance of the transport network responsible for delivering the service. This moves the burden of network capacity scheduling for a service like video conferencing from the end user to the service manager. The manager can scale to thousands of service profiles and millions of records through the use of open platform Oracle 8i database technology.

Redback has an installed base of more than 2,700 subscriber management systems, which enables service providers and carriers to provision, aggregate and manage broadband, leased-line and dial-up subscribers through a single, unified platform. In addition, the company recently unveiled its Smart Edge optical platform, which delivers both traditional time-division multiplexing and IP-based services. The company said this lays a strong foundation for the delivery of IP services and the addition of Abatis’ highly scalable, multi-vendor service infrastructure will enable it to increase the revenue generating IP service opportunities it provides to its customer base.

Redback has a customer base of more than 230 providers, including UUNET, EarthLink, PSINet, Concentric Network and Verio. Carriers include SBC, GTE, Bell Atlantic, Bell Canada, Qwest and Singapore Telecom.

The combination of Abatis Systems’ service-enabling software framework and line of IP edge services and Redback’s Subscriber Management System and SmartEdge products will enable customers to deliver and enforce IP services like virtual private networks and voice over IP.

Redback said it expects the revenue opportunities opened by its expanded product set will span all major networking technologies within the New Access Network, including DSL, cable, wireless, SONET, SDH, leased lines, frame relay and ATM.