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Japanese long distance phone company NTT Communications (NYSE: NTT) has reached agreement to buy the U.S.-based website-hosting firm Verio (Nasdaq: VRIO) in a cash deal worth $5.5 billion.
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Fiber channel designer QLogic (Nasdaq: QLGC) has agreed to buy fiber channel switch manufacturer Ancor Communications (Nasdaq: ANCR) for about $1.7 billion. That's roughly a 70% premium to Ancor's closing price on Friday. The deal is expected to close in the third quarter and QLogic expects it to be neutral to earnings, or add to earnings slightly, in 2001.
Chairman of Internet access firm Excite@Home (Nasdaq: ATHM) Thomas Jermoluk resigned at a board meeting last week, The Wall Street Journal reported. He's expected to remain a director at the company, but he is also negotiating to become a partner at reknowned venture capital firm Kleiner Perkins Caulfield & Byers.
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The deal values Verio at $60 per share, which represents about a 66% premium to Verio's closing price on Friday. NTT already owns 10% of Verio and expects to tender its offer to require the remaining outstanding shares no later than May 17. The deal is expected to close in the third quarter. The boards of both companies approved the transaction.
The merger not only gives NTT a foothold in the U.S. but will increase the strength of its Internet service offerings, especially in the hard-to-address small and medium business market. Verio hosts the websites of more than 400,000 small and medium-size businesses and operates an Internet backbone network.
The company, which started out as a roll-up Internet service provider, has increasingly concentrated on higher-end services such as hosting complex business software packages for its customers. It operates 10 data centers in the U.S. and is adding 650,000 square feet of data center space this year.
The alliance underscores the extent to which traditional phone companies are looking to bundle Internet services with typical calling operations. Voice services are already a commodity and Internet access is quickly becoming commoditized as well. As a result, carriers like Verio rival PSINet (Nasdaq: PSIX) are looking to hook customers with Internet access and then add on differentiating services like Web hosting, e-commerce, and consulting.
Medical device and diagnostic products manufacturer Epitope (Nasdaq: EPTO) has agreed to merge with privately held STC Technologies, which designs and manufactures in vitro diagnostic products and medical devices. The new company will be renamed OraSure Technologies and will focus on oral fluid technology, infectious disease testing and substance abuse testing.
Fallen enterprise resource planning star Baan (Nasdaq: BAANF) has pretty much abandoned hopes of a turnaround and is shopping the company, The Wall Street Journal reported. The Dutch company has approached many of its partners and rivals but hasn't generated much interest. Executives may end up selling the company piecemeal.
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