VegaStream Completes MBOVegaStream Completes MBO

LONDON -- VegaStream, the leading supplier of dedicated business VoIP (Voice over IP) Gateways, today announced the completion of its management buy-out from Pace Micro Technology Plc and its re-launch as an independent company. With an established technology, customer and partner base, the new investment in VegaStream will enable the company to reinforce its leadership in the VoIP media gateway market, which is estimated by In-Stat/MDR to increase by over 24% in 2003. Investors in VegaStream include MTI Partners - a leading VC investor in the communications sector - and VegaStream management; Pace Micro Technology retains a 20% share in the new business.

VegaStream's VoIP Gateways are targeted at Service Providers and enterprises of all sizes, from SME and small branch offices to large corporate campus offices. Interoperable with all leading PBX industry and vendor standards, VegaStream is the leading global supplier of dedicated business VoIP Gateways, serving both the North American and European markets. The new VC investment in VegaStream will enable the company to expand its channel sales and marketing reach, product development and support for these markets.

"Whilst the last few years have undoubtedly been hard for the telecoms industry and VoIP has gone through a repeating cycle of hype and disillusionment, all the signs are now pointing towards VoIP finally delivering on its promise. The technology works, partners are working together to secure interoperability and - most importantly - real customers are deploying it," said Tim Burne, CEO, VegaStream. "The two years VegaStream spent as part of Pace's R&D division incubated us from the downturn and enabled us to focus on getting the product right. The MBO comes at just the right time for VegaStream, giving fresh impetus to the company at a time when business VoIP is becoming mainstream."

"The dedicated VoIP Gateway market is characterised by one large data-comms company in Cisco and a number of smaller, largely regional, competitors," said Ernie Richardson, MTI Partners. "VegaStream, because of its open standards-based approach and full interoperability with virtually every major PBX, is uniquely placed to offer a dedicated business VoIP gateway that is a genuine Cisco alternative in North America, Europe and other major global markets. The major market potential now being manifested in business VoIP, together with the calibre of VegaStream's management team, leaves us with no doubt that this is the time to invest in this new stage in the development of the company."

VegaStream will officially launch its new corporate identity at VON Fall in Boston on 22 September where it is exhibiting on stand 601.

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