A month old US start-up created by the former management of Ascend Communications has gone on the acquisition trail, paying $248 million for telco equipment maker, Premisys.
Zhone Technologies, which is said to be heavily backed by venture capitalists, announced on Thursday that it would purchase all of the outstanding shares of Premisys for $10 each.
Premisys, which manufacturers equipment to enable enterprises to funnel voice, video and data over a single pipe to a service provider, will become a subsidiary of Zhone and Nicholas Williams, Premisys' president and chief executive, will become the unit's president.
Williams said: "By becoming part of Zhone, we become part of something much larger than we could create on our own and extend our mission of providing global telecommunications service providers with premises based platforms that integrate access to a variety of voice, data, and video services."
Zhone's management team is headed by Mory Ejabat, the former chief executive of Ascend, which is now owned by Lucent Technologies. Ejabat also brought some of the old Ascend management team with him to the new venture, specifically, Jeannette Symons, Ascend's former chief technology officer, and Bob Dahl, its former chief financial officer.
The start-up is positioning itself on its Web site as a communications equipment provider, which "will focus on delivering products and software for the construction of next generation networks built to deliver voice, data and video traffic."
But Zhone officials refused to give further plans and cancelled a press conference on Thursday, where it it was expected to announce it had received up to $500 million in funding.
A company spokesperson said officials will speak at the end of the month.
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