Stratus Finally Sold
biz.yahoo.com
Tuesday February 23, 6:58 am Eastern Time
Company Press Release
Ascend Announces Divestiture of S2 Systems,
the Final Non-Telecom Business Unit of Former
Stratus Computer, Inc.
Ascend's Divestiture Strategy Raises the Bar for Successful Technology
Acquisitions
ALAMEDA, Calif.--(BUSINESS WIRE)--Feb. 23, 1999-- Ascend Communications, Inc. (Nasdaq:ASND -
news), a leader in wide-area networking (WAN) and Intelligent Network (IN) solutions for providers and users of
the next generation public network, today announced the sale of S2 Systems, the last non-telecom business
unit of the former Stratus Computer, Inc.
S2 Systems, a provider of electronic commerce software systems and professional services, will be sold to an
affiliate of Baker Capital Corp., a private equity management firm.
After acquiring Stratus on Oct. 19, 1998, Ascend committed to divesting Stratus' four non-telecom business
units, S2, TCAM, Astria and the Enterprise Computer unit, in order to focus its efforts on the convergence of
voice and data networks. The sale of S2 marks the final chapter in what many have viewed to be one of the
most astute and successful corporate acquisitions within the technology industry.
''Our acquisition of Stratus and immediate divestiture of the non-telecom business units has set the standard
for a textbook acquisition strategy,'' said Ken Fehrnstrom, senior vice president of business development for
Ascend.
''Equally important to our strategy was determining how to successfully divest the non-telecom business units,
while creating additional value for all parties involved. Once the decision to acquire Stratus was made, we
knew the remaining non-telecom assets would have a renewed value to each of their respective market
segments.''
Ascend took the following actions in selling Stratus' non-telecom business units:
-- Jan. 11, 1999 -- Ascend announced a definitive agreement
regarding the divestiture of the Enterprise Computer Division of
Stratus Computer, Inc. to Investcorp, a global investment group.
-- Jan. 19, 1999 -- Ascend sold its 50 percent interest in the
former Stratus Computer, Inc.'s financial software joint venture
(Astria) to French based Atos, a leading European information
technology services provider.
-- Feb. 8, 1999 -- Ascend announced a definitive agreement to sell
TCAM Systems, which develops and markets software for the global
securities and financial exchange industries, to Swedish-based OM
Technology.
''Clearly, Ascend has proven itself to be a market leader, in not only technology, but growth strategy and
business development as well,'' said Paul Johnson at BancBoston Robertson Stephens.
''Ascend saw an opportunity to acquire a company with innovative, market-driving technology which would
enhance Ascend's core product offerings. They were able to concurrently divest the non-telecom assets for a
financial gain, demonstrating a creative solution that benefited both customers and employees.''
Ascend's acquisition of Stratus' telecom technology equips Ascend with SS7 software and technology, as well
as fault-tolerant computing platforms that enable the integration of voice and data networks.
Ascend's solutions based on these technologies enable network service providers to implement cost-effective,
reliable and transparent means of relieving network congestion while reducing operating costs on the public
switched telephone network (PSTN).
Since the acquisition of Stratus, Ascend has shipped the Ascend SS7 Gateway (ASG), the first commercially
available, standards-based SS7 gateway product that relieves congestion on the PSTN.
By transparently routing calls between voice and data networks, this breakthrough solution will end Internet busy
signals, cut the cost of providing dial-up connections, and free-up PSTN circuits to carry voice traffic.
This exemplifies Ascend's commitment to delivering best-in-class, enhanced service solutions, along with their
ability to meet the needs of customers worldwide.
About Baker Capital Corp.
Baker Capital Corp. manages one of the country's largest private equity funds focused exclusively on
communications industry investments. It targets controlling and significant minority equity positions in
companies that provide communications software, equipment, services, and applications.
Investors in the fund include prominent insurance companies, university endowments and foundations, public
and private pension funds, financial institutions, and families.
About Ascend Communications
Ascend Communications, Inc. (Nasdaq:ASND - news) develops, manufactures, sells and services wide area
networking solutions for telecommunications carriers, Internet service providers and corporate customers
worldwide.
For more information about Ascend and its products, please visit the Ascend Web site at www.ascend.com, or
send e-mail to info@ascend.com. For Investor Relations, please call our communications hotline at
800/648-3059 or 760/704-4423 (outside the United States and Canada).
Additional investor information can also be accessed on our Web site at: ascend.com.
Ascend is headquartered at One Ascend Plaza, 1701 Harbor Bay Parkway, Alameda, CA 94502; phone is
800/ASCEND4 and fax is 510/814-2300.
The foregoing statements may contain forward-looking statements that are based on current expectations and
involve risks and uncertainties. Actual results could differ materially from these expectations as a result of
factors including, but not limited to, the company's success in developing, introducing or shipping new
products, competition, the mix of distribution channels employed, the company's dependence on single or
limited source suppliers for certain components used in its products, risks inherent in international sales,
seasonality and general economic conditions. These and other factors are discussed in Ascend's 10-K, 10-Q
and other filings made periodically with the Securities and Exchange Commission.
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