Counsel Communications Acquires Nexbell
Communications
CCN Disclosure - August 21, 2000 05:00
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TORONTO, ONTARIO--
Strategic Platform for Launch of Next Generation VoIP Services
Counsel Corporation (TSE:CXS / NASDAQ:CXSN) ("Counsel" or the
"Company") announced today that Counsel Communications LLC
("C-COM"), a Company subsidiary, has acquired Nexbell Communications,
Inc. ("Nexbell") in a stock-for-stock merger with WebToTel Inc.
("WebToTel"), a wholly-owned subsidiary of C-COM. C-COM will own
approximately 76% of the merged company.
The acquisition of Nexbell is the initial phase of a strategic initiative to create a
highly scalable voice/data network using Internet Protocol ("IP") technology.
Ultimately, C-COM's goal is to facilitate the deployment of next generation
web-based communications services. The acquisition of Nexbell will be
followed by the addition of substantial, profitable retail trafficto the IP network,
culminating in the convergence of the Internet with traditional telephony traffic
through the creation of a nationwide VoIP network.
Established in 1998, Nexbell operates a private, managed packet telephony
network. From its 32 super-Points of Presence ("POPs"), Nexbell delivers
packet voice services to over 400 key metropolitan areas. Nexbell's
next-generation Voice over IP ("VoIP") service has received designation as a
Cisco Powered Network service from Cisco Systems, Inc.
(NASDAQ:CSCO). While manynew entrants are building next generation IP
networks focused on driving down the cost of transport, Nexbell's vision is to
build and provide valuable application layers over their packet telephony
infrastructure. Packet voice technology enables the discreet transmission of
multiple conversations and faxes across the same line, significantly improving
network efficiency, while effectively managing costs.
The primary strategic rationale for C-COM's acquisition of Nexbellis the
breadth of their existing owned network and the quality of their management
team, which together will accelerate the deployment of C-COM's VoIP
network, giving it the ability to overlay traditional telephony traffic at significant
cost savings.As previously announced, C-COM has entered into a definitive
agreement to acquire the assets of PT-1 Communications, Inc. ("PT-1"), a
subsidiary of Star Telecommunications, Inc. (NASDAQ:STRX). PT-1 is a
leading provider of retail telephony services, with more than US$500 million of
annualized revenues andseven billion minutes of traffic in 1999. The acquisition
of Nexbell will enable C-COM to more rapidly deploy an IP-based telephony
network, dramatically reducing unit transport costs at PT-1. The initial focus
will be on the domestic market, where Nexbell already offers coverage to over
90% of PT-1's traffic, thereby creating immediately achievable synergies.
"The vision espoused by the leadership of Counsel is the same vision that has
motivated our company from the beginning," stated Andre Temnorod, CEO,
President and founder of Nexbell Communications. "We are tremendously
excited by the opportunity tomigrate PT-1's sizeable revenue and subscriber
base to the more efficient and flexible IP infrastructure. Our ability to seamlessly
integrate the traditional voice network with the Internet over our private IP
network promises new market potentialfor both PT-1 and Nexbell."
Gary Wasserson, CEO and President of C-COM, commented, "I have hadthe
privilege of working with Nexbell since its inception. Nexbell's technology team
has proven its ability to deploy scalable VOIP applications for commercial
purposes. We view Nexbell as a perfect strategic partner in the development
and implementation of a powerful and scalable nationwide IP telephony
network. Nexbell's state of the art technology infrastructure willenable the
seamless delivery of high quality voice, data and other"value-added" services,
capitalizing on the power and efficiency of the Internet as we move into the next
generation of communications products and services."
Allan Silber, Chairman and CEO of Counsel said "The acquisition ofNexbell
represents our completion of a critical element in the successful implementation
of our communications business strategy.It will provide a platform for dynamic
revenue growth and value creation for shareholders."
About Counsel Corporation
Counsel Corporation focuses on building businesses that specializein enabling
technologies delivered through the Internet, and communications to leverage the
services and products provided by other established companies. Among
Counsel's recent strategic portfolio investments are: a 33% stake in Impower,
Inc., an emerging leader in the rapidly growing area of transaction-based
Internet direct marketing; a 40% stake in Proscape Technologies, Inc., a
leading provider of innovative B2B fact-based sales and marketing information
software systems to Fortune 1000 companies; a 26% stake in IBT
Technologies, Inc., an application service provider for the e-learning industry; a
31% stake in Core Communications Corporation, a leading provider of
integrated pay-per-use Internet access, billing and control services for
convention, conference and public meeting places; and C-COM , a wholly
owned subsidiary, formed to acquire, consolidate and operate Internet
telephony and other communications-related assets.
About Nexbell
A designated Cisco Powered Network member, Nexbell Communications is a
packet telephony infrastructure provider currently deploying a nationwide
network of POPs for delivery of IP based Voice/Fax services. Nexbell can
offer competitive toll quality voice transport services such as those offered
today by long distance service providers and ILECs. Nexbell will offer
customers an extensive array of carrier-grade, phone-to-phone IP products
and services including long distance, fax, IP/PBX, unified messaging and
call-back services. For more information, call Nexbell at (888) 365-3700,
e-mail info@nexbell.com, or visit www.nexbell.com.
FOR FURTHER INFORMATION PLEASE CONTACT:
Counsel Corporation
Stephen Weintraub, Senior Vice President & Secretary
(416) 866-3058
or
Strategic Growth International, Inc.
Richard Cooper / Rob Schatz
(516) 829-7111
or
Nexbell Communications
Barry Greenspan, Vice President
(216) 344-5753
INDUSTRY: DTC
SUBJECT: TMN
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