Business communications services provider Via Net.Works Inc., with an eye toward expanding its hosting services business, has acquired the continental Europe operations of PSINet Europe BV.
With the purchase, for about €18 million ($22 million, as of Monday) in cash and stock, Via will acquire PSINet's operations in Belgium, France, Germany, the Netherlands and Switzerland, according to a company statement. Those units serve about 4,000 customers. PSINet Europe's U.K. operations are not part of the deal.
Via expects to save about $4 million per year through integration of the two companies' resources in continental Europe. It plans to cut headcount, network costs and general and administrative costs, as well as combining back-office functions. Those steps should be substantially complete within six months of the deal's closing date, which is expected to be within 10 days, the statement said.
PSINet Europe was formed as an independent subsidiary of PSINet Inc. in 1997 and acquired by a consortium led by Israel Corp. Ltd. of Tel Aviv in 2002. It has its own IP (Internet Protocol) network and six data centers and provides hosting, managed networks and managed access services to medium-sized and large businesses. Via, based in Amsterdam, provides hosting, security, connectivity, network, voice and professional services to more than 200,000 small and medium-sized companies in Europe and the U.S.
The combined business should have annual revenue of more than $110 million, with the mix consisting of about 30 percent hosting, 55 percent Internet access and 15 percent other managed services, such as VPNs (virtual private networks), the statement said.