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Nortel scoops up British software firm

The provider of data and telecommunications equipment buys privately held X-Cel Communications, a London-based maker of network management software tools.

Nortel Networks continues to dip into its coffers to fill technology holes.

The provider of data and telecommunications equipment announced the acquisition of privately held X-Cel Communications, a London-based maker of network management software tools targeted at voice carriers and service providers.

Terms of the cash deal were not disclosed. X-Cel had $10 million in sales for 1998.

Nortel plans to plug X-Cel's software into its Integrated Network Management series of high-end management products. X-Cel specializes in "service level agreement" technology, or SLA, and network performance management tools.

Nortel previously re-sold X-Cel's technology. Full integration of the firm's tools into Nortel's operations is scheduled for the end of the year.

Nortel has stepped up its acquisition efforts recently, grabbing high-end equipment start-up Shasta Networks last month for $340 million.

Separately, Nortel also announced it has spun off Elastic Networks, formerly a unit of the company. Elastic has received $12.6 million in funding from venture firm Pequot Capital Management and Texas Instruments to continue developing Ethernet-based phone line networking hardware and software.