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Turin Bulks Up With Backhaul Buy

Analysts say the marriage of Turin Networks Inc. and Carrier Access Corp. (Nasdaq: CACS) combines two very complementary technology stories, and customer bases that have very little overlap between them. (See Turin to Buy Carrier Access.)

"They are complementary on the technology side and on the customer side," says Ovum Ltd. analyst Dana Cooperson. On the technology side, she says, "Carrier Access sits at the customer edge of the network, while Turin focuses more on the core and metro edge of the network."

The combination of complementary technologies will help broaden Turin's overall product portfolio, allowing it to offer more of an end-to-end solution set. That will come in handy, Cooperson says, as more service providers look to one-stop-shop vendors for their equipment.

"We would expect more alignments of this type," Cooperson says. "Service providers want more of an end-to-end solution, and nowhere is that more true than on the wireless side."

One financial analyst, who asked not to be named, says competitive pressure from larger equipment vendors is making life very tough for the smaller, specialist players. "Carrier Access identified the market for wireless backhaul early on, but it was a small market. As bigger players came in and changed the competitive landscape, it made a deal inevitable," he says.

Michael Howard, principal analyst at Infonetics Research Inc. , says the customer base is also very complementary. "Carrier Access has about 100 customers, a lot of which are Tier 1 operators, and Turin has a lot of Tier 2 and Tier 3 service providers."

Merging the two companies could help Turin sell up into Tier 1 accounts where it doesn't already have a presence, particularly in service providers that have both wireline and wireless assets.

Turin is also hoping to leverage the companies' complementary sales and marketing stories. Turin has a significant direct sales force, while Carrier Access sells primarily through channel partners. While Turin is looking to expand its sales channel, it also thinks it can leverage its existing sales force to sell Carrier Access gear.

Turin Networks CEO Henry Wasick says, "We like the business model from a sales and marketing standpoint. The real benefit here for a combined entity is that we have many more sales and marketing people on the street than they have."

— Ryan Lawler, Reporter, Light Reading

bollocks187 12/5/2012 | 2:57:13 PM
re: Turin Bulks Up With Backhaul Buy This is a 'funny' financial deal.

LR why don't you ask CAC or Turin why the acquisition was not the other way.

How can a private startup not making money itself buy CAC which is financial more stable company than Turin.

paolo.franzoi 12/5/2012 | 2:57:13 PM
re: Turin Bulks Up With Backhaul Buy
Bollocks,

You have not stated that you are a VC. I am guessing that you are, otherwise you would not be privy to the finances of Turin.

If you are declaring that CAC was an older, generally more stable entity than Turin - that is not news. However, Turin is supposed to come up with $93M in cash. That implies that they have well over $100M in the bank. Turin has been selling some amount of product for a number of years.

Also, this is Webley's company, even as little as he pays attention to Turin nowadays. If you think that some board member is able to manipulate Henry and John you are sadly mistaken.

seven
bollocks187 12/5/2012 | 2:57:10 PM
re: Turin Bulks Up With Backhaul Buy (same as previous post just some minor updates)
---------------------------------
7, Well since you brought it up.

Turin does not have $93 Million in CASH to pay for the transaction. It never had that amount of money as it has never been financially stable... hence the number of VC rounds it has received - rumour is 'F' round this summer for $45M.

A VC bridge loan or late cash infusion due to the shell company of acquiring CAC for the $93M is very possible until they can raid the $63M in the CAC bank coffers. Net is $30M sale of CAC. Perhaps the top-common institutional investors for CACS and NWK(another doll compnay) will put up the short term cash.


7, If they had $93Million DUE to product sales then they would have gone IPO themselves or got bought out - all the good engineers and sales/marketing folks have well and truly left.
Henry's comment about Turin large sales team is actually BS to somehow justify the merger - all the sales guys that made it happen at Turin have left.....Doll brought in Chris Stark (ex Alcatel) and the failed CEO of Luminous (Doll company)- and at the time a competitor of Turin.

In conclusion the BoD controls Turin - Webley is "retired" and is his own man - perhaps he likes CAC and sees this as the only way out for Turin. CEO Henry (Mr. Maintence Man) is the paid hand and the "puppet" of the BoD (Dixon/BJ).

7, you are very sadly wrong in your understanding of Turin - stick to technical Moca and 400Mbps - your out of your league on this topic -ROFL

Fact not Fiction
bollocks187 12/5/2012 | 2:57:10 PM
re: Turin Bulks Up With Backhaul Buy 7,

Well since you brought it up.

Turin does not have 93 Million in CASH to pay for the transaction. It never had that amount of money as it has never been financial stabel hence the number of rounds it has recieved financing - rumour is 'F' round this summer for $20M. A VC bridge loan for the $93M is very possible until they can raid the $63M in the CAC bank coffers.

It has never been cash flow positive.

There has to be a cash infusion into the company from the Turin VC on the board or someone else.

7, The BoD controls Turin - Webley was ousted and Henry is the puppet of Dixon Doll. You are very sadly wrong in your understanding of Turin - stick to technical Moca and 400Mbps - your out of your league on this topic -ROFL

Fact not Fiction
bollocks187 12/5/2012 | 2:57:09 PM
re: Turin Bulks Up With Backhaul Buy 7 get off this board you have not posted anything of interested or value just responded to my posts. Unusual for you as you are normally a preacher.

Put something on the table about the merger to debate or go away.

ROFLx2
bollocks187 12/5/2012 | 2:57:09 PM
re: Turin Bulks Up With Backhaul Buy
Henry simple worked on cost and head count reduction - business has been flat.

7, come up with some facts not your opinion. Who has Henry brought on to the company then ?? Your probally goign to run away on this topic as well -ROFL cannot handle the heat.

Fact not Fiction
paolo.franzoi 12/5/2012 | 2:57:09 PM
re: Turin Bulks Up With Backhaul Buy
I think my understanding of Turin exceeds yours. Henry has brought in all those people. You certainly have no idea how the deal will be financed.

You are very good at making up your own fantasy. You should probably go write novels.

seven
rbkoontz 12/5/2012 | 2:57:06 PM
re: Turin Bulks Up With Backhaul Buy Is Turin going public with this deal or taking CACS off the stock market with a cash buy-out?
rbkoontz 12/5/2012 | 2:57:06 PM
re: Turin Bulks Up With Backhaul Buy What are these quoted "analysts" thinking?

I'm a simple guy and don't need an MBA to see the flaws in this deal. Acquirer can use acquiree to expand markets for existing products or take new products into existing markets. Never does a deal with no DNA synegy between products and markets succeed and that's what this is.

It looks to me Turin is working hard to become the next Zhone.
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