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Sonus Acquires Performance Technologies for $30 Million

December 13, 2013

Roughly a week after promoting Tony Scarfo to executive vice president of Technology and Business Development, Sonus Networks (News - Alert) has entered into a definitive merger agreement with Performance Technologies (PT), a global supplier of advanced, high availability network communications solutions. Under the agreement, Sonus will acquire PT for around $30 million, or $3.75 per share in cash.

Obviously, as is often the case when large companies merge, this has big implications for both Sonus and the communications market in general. For Sonus, acquiring PT allows it to expand and diversify its portfolio with an integrated, virtualized diameter signaling and SIP-based solution.

For the SIP market, this means that Sonus’ size and reach is now much greater and will likely allow it to further thrive in this space. Meanwhile, the company has now also entered the diameter signaling market, which should expand its addressable market by 50 percent to nearly $3 billion in 2017.

"Today's mobile broadband traffic nearly eclipses all Internet activity from just a decade ago, driving the necessity for intelligent and capable Diameter Signaling Controllers that will allow mobile operators to efficiently deploy 4G/LTE (News - Alert)," said Raymond P. Dolan, president and chief executive officer of Sonus, in a statement. "The combination of Sonus and PT allows us to address this significant opportunity by bringing together unique and complementary technologies in wireless and wireline network intelligence, thereby expanding our addressable market by 50 percent and advancing our mobility and virtualization strategies. The transaction enhances Sonus' best-in-class portfolio, further enabling service providers and enterprises to deliver on the promise of real-time communications."

Aside from expanding Sonus’ addressable market and enhancing its portfolio of offerings, the merger agreement also provides the company with new, complementary assets, since the diameter signaling market is closely related to the session border controller (SBC) space.

The transaction, which was approved unanimously by both the board of directors of both companies, is expected to close some time in the first quarter of 2014.

Edited by Cassandra Tucker

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