Cisco, Comptel Strike a SPIT Deal

Cisco Systems Inc. (Nasdaq: CSCO) is gathering some Service Provider Information Technology (SPIT), having announced Monday that it's acquiring some Axiom Systems assets (and some employees) from Comptel Corp. (Nasdaq, Helsinki: CTL1V).

The cash deal, worth about €21.3 million (US$31 million) and expected to close in September, includes the Axioss suite of service fulfillment software, which would be added to the Cisco Prime set of network management products.

Cisco would also get an undisclosed number of Comptel employees, most of them in the U.K. Comptel CTO Gareth Senior -- formerly CTO of Axiom, before Comptel acquired it in 2008 -- would be among them.

Comptel says it would continue supporting Axioss customers after the deal closes.

Why this matters
It's an obvious move for both sides, says Heavy Reading analyst Ari Banerjee.

The significance might be heavier on Cisco's side. Cisco already uses Axioss a lot for network service management, so it would be patching a gap in Cisco Prime.

Comptel, meanwhile, has already integrated parts of Axioss into its own products, which is why it's saying it would continue supporting Axiom customers. CEO Juhani Hintikka, who took over in January, gets to streamline Comptel a bit as he tries to push the company to the next tier in terms of size. Comptel might even have made a profit on the deal; it acquired Axiom for about $13.8 million, plus performance bonuses that could have pushed the total price to $45.5 million.

Cisco was already one of Comptel's two most important customers (IBM Corp. (NYSE: IBM) being the other one), and the deal further cements that relationship. Cisco could end up sending more business to Comptel, for those service providers that have deeper OSS needs. "All the API [application programming interface] hooks have already been created. It just makes it easier for them to choose Comptel," Banerjee says.

For more
A few notes on Comptel's situation and the Axiom deal:

— Craig Matsumoto, West Coast Editor, Light Reading

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