EarthLink to plug in VPN provider
Internet service provider looks to boost its broadband appeal to small businesses with acquisition of New Edge Networks.
The $144 million deal is intended to help the ISP expand its presence in a fast-growing business segment. The two companies will jointly offer broadband access and VPN services, including packages of voice, data and protection.
New Edge owns data communications networks projected to generate revenue of about $120 million in 2005.
The move underscores the pressure on broadband contenders to offer a wide array of services. Competition for customers has intensified among telephone companies, cable TV providers and more traditional ISPs such as EarthLink.
New Edge will operate as a fully owned subsidiary of EarthLink and will retain its brand name. EarthLink said it plans to retain 345 workers of the Vancouver, Wash.-based firm. Dan Moffat will remain as president of New Edge after the acquisition is completed.
The acquisition, which is subject to regulatory approvals, is expected to close in the first quarter of 2006.