PaeTec Buys Two Companies, Enter ASP Biz

PaeTec Corp. (www.paetec.com), the parent company of competitive telecom provider PaeTec Communications Inc., yesterday inked definitive agreements to purchase two companies. The deals will allow PaeTec to immediately become a prime player in the hot application service provider (ASP) segment, while further strengthening its network services strategy.

In the first agreement, PaeTec is purchasing Pinnacle Software Corp. (www.pinnsoft.com), a professional services and software development company. Pinnacle provides application software systems to customers who serve about 1 million subscribers in the Fortune 1000, higher education, medical and government markets.

Pinnacle develops software solutions to help businesses manage customer billing, inventory control, asset management, help desk management, cable management and switch provisioning. "There are natural synergies between Pinnacle and PaeTec that make our alliance an exceptional strategic fit," Arunas Chesonis, PaeTec's chairman and CEO, said in a statement. "Together we will be able to build upon our successes to accelerate new offerings, such as ASP, professional services and facilities management."

Pinnacle's 30 employees are expected to be retained upon the merger's closing.

The second acquisition is of Data Voice Networks Inc. (www.dvni.com), a Springfield, Pa.-based data network design and implementation firm that serves small and mid-sized businesses in the mid-Atlantic states. PaeTec is hoping to use DVN to strengthen its network service offerings in that territory.

DVN, a Cisco Systems dealer and a member of the Cisco VAR counsel, will help PaeTec speed the implementation of its data product offerings.

PaeTec did not disclose the value of the acquisitions.

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