Paetec Buys FTS Unit

PAETEC Holding Corp. has signed a definitive agreement to acquire the entire assets and assume certain liabilities of Formula Telecom Solutions in a $13 million all-cash transaction

December 13, 2010

2 Min Read

FAIRPORT, N.Y. and HERZLIYA, Israel -- PAETEC Holding Corp. (NASDAQ GS: PAET), a FORTUNE 1000 company, and FTS Ltd. (LSE: FTS), a global provider of billing, customer care and policy control solutions for communications and content service providers, announced that PAETEC's wholly-owned subsidiary, PAETEC Software Corp. (PAETEC Software) has signed a definitive agreement to acquire the entire assets and assume certain liabilities of Formula Telecom Solutions, Inc., a wholly-owned subsidiary of FTS, in a $13 million all-cash transaction. The purchase is expected to close in late December of 2010.

PAETEC is a leading national communications carrier in the United States that provides voice and data solutions to business-class customers. FTS Inc.'s Leap RevChain is considered one of the strongest billing platforms in the telecommunication industry and has been PAETEC's primary billing system since its inception in 1998. Upon the closing of this transaction, the Leap RevChain billing system will be the heart of the new RevChain Solutions division of PAETEC Software. The RevChain Solutions division expects to continue investing in the development of high performance invoicing solutions for businesses, institutions and carriers.

"We've been using the Leap RevChain billing system for over 12 years. Acquiring the system and its loyal development and support teams not only protects our supply chain, but also offers us an opportunity to continue to innovate the product and grow revenue to the benefit of all Leap RevChain customers," said PAETEC Executive Vice-President and Chief Information Officer, Robert Moore. "Our customers tell us that we have the simplest and most useful invoice in the industry, primarily due to the power and capabilities of Leap RevChain."

"PAETEC was always a great customer of FTS Inc.," said Amos Sivan, FTS' CEO. "They have clearly seen the potential in the Leap RevChain solutions and we're delighted that they will be building on the great work we have done. This deal is a testament to the hard work and dedication of the great team we built at FTS Inc."

Paetec Communications Inc. (Nasdaq: PAET)

FTS (London: FTS)

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