3Com to Acquire Primary Access and Sonix: Global data networking leader aggressively extends networking beyond the enterprise and broadens remote access connectivity with leading network access companies.

SANTA CLARA, Calif.--(BUSINESS WIRE)--March 22, 1995--Today, global data networking leader 3Com Corporation announced definitive agreements to acquire Primary Access Corporation, the dominant provider of integrated remote access systems to network service providers worldwide, and Sonix Communications Limited, the leading U.K. ISDN internetworking company. As leaders in their respective markets, these companies will enable 3Com to significantly extend its networking reach beyond the enterprise.

The acquisitions of Primary Access for approximately $170 million in 3Com stock and Sonix for approximately $70 million in 3Com stock will both be accounted for as poolings and are expected to close in the fourth fiscal quarter. The Primary Access transaction is subject to a number of conditions including anti-trust approval, the effectiveness of a registration statement covering the shares to be issued, and approval of the shareholders of Primary Access Corporation. 3Com expects the number of shares to be issued for the two transactions to be approximately 4.3 million. Both companies will become wholly owned subsidiaries of 3Com, to be known as 3Com Sonix and 3Com Primary Access.

With Primary Access, 3Com can now provide high-performance, fully integrated access products for the public switched data market. This will further strengthen the company's position with service providers and carriers, who are increasingly providing managed data network services from points of presence (POPs). ISDN-based LAN internetworking products from Sonix will enable 3Com to push out the periphery of the networks to the growing small business, commercial and home Internet access markets.

"Sonix and Primary Access are innovative, customer-driven leaders in their respective markets and have products, technologies and, most important, strong customer relationships that will help accelerate 3Com's participation in new, emerging market segments," said Eric Benhamou, 3Com chairman and chief executive officer.

"Data networking is embracing more than the enterprise as access to information is required by a broader spectrum of users. As this growth continues, customers will increasingly value the ability to purchase access, internetworking, terminal server and remote access router technologies from a single vendor with a coherent, integrated networking architecture," said Benhamou. "With these acquisitions, 3Com is now the only company to offer data networking and network access solutions for the enterprise, carriers and small office/home office."

Leading Platforms for Managed Services in the Public Networking Sector Primary Access, based in San Diego, is the leading supplier of integrated remote access systems used by interexchange, cellular and local carriers as well as providers of on-line information services, value added networks (VANs) and transaction networks. Founded in 1988, the company had revenues of $26.5 million in fiscal 1994 (ended September 30). Primary Access' products are used at network providers' central sites to deliver a dial-up connection linking users of on-line information over the public switched telephone network.

Primary Access simplified WAN connectivity and pioneered software-defined access using a digital platform, called Aperture, to replace separate fixed-function hardware devices such as channel banks, modems, ISDN devices and remote access servers. This software-based approach enables network providers to get data services to market faster, improve network flexibility and reliability, and reduce network management, maintenance and access costs.

Primary Access' products are used for network access in three rapidly growing markets: high-speed data, cellular data and transaction processing networks.

Applications using Primary Access products include accessing CompuServe, United Parcel Service's Total Trak cellular package tracking, and credit-card transaction processing over the VisaNet network. Other Primary Access customers include AT&T, MCI, Sprint, more than 15 cellular carriers, regional Bell operating companies, Blue Cross, and leading banks and oil companies. 3Com Primary Access, with 120 employees, will remain based in San Diego. Bill Stensrud, president of Primary Access, will continue to manage the business reporting to 3Com CEO Eric Benhamou.

"Both large and small organizations are increasing their use of carrier-provided managed data services," said Stensrud. "Primary Access' telecommunications expertise combined with 3Com's data networking experience will allow us to fully exploit new access trends in both public and private networks as well as capitalize on commercial networking opportunities and on-line services such as the Internet."

Extending Leadership in Small Office Markets

Widespread end-user demand for low-cost, high-speed connectivity to both corporate networks and on-line services is encouraging the rapid deployment of ISDN worldwide. Founded in July 1992, Sonix has grown quickly, reaching approximately $25 million in revenues for the last twelve months. The company has already achieved ISDN market leadership in the U.K., capturing 46 percent of the country's ISDN internetworking market in 1994 according to Dataquest. The company is the third largest ISDN networking company in Europe with 19 percent share, and is poised to enter new markets. Sonix manufactures and markets a portfolio of network access products specifically designed for data and voice, and designed from inception to optimize ISDN technology while being easy to use and configure.

Targeted for the simple connectivity needs of wide area workgroups, and particularly popular with retail and financial customers, the company's flagship Arpeggio family of ISDN internetworking products include "plug and play" low-cost Ethernet to ISDN, leased-line or dial-up bridges and routers. The Arpeggio products are ideal for providing connectivity among small dispersed workgroups and for providing simple, high-performance, low-cost connectivity between central sites and remote offices.

The success of Sonix' products is directly related to their design center, which was developed from the perspective of the small office needing simple access to other offices. The company offers a family of low-end, remote connectivity solutions designed from the ground up for ISDN and analog connectivity, voice and data, and "plug-and-play" simplicity.

3Com Sonix, with its 53 employees, will remain in Cirencester, Gloucestershire. Bob Jones, managing director of Sonix Communications, will report to 3Com vice president Richard Joyce, who is spearheading 3Com's worldwide efforts to address the unique networking requirements of the small business market.

"With a strong emphasis on high-performance and ease-of use combined with its focus on providing the right product for the right application, Sonix is poised to replicate its tremendous success in the UK around the world," said Richard Joyce. "Small businesses, mobile workers and home users are now demanding networking equipment designed to meet their unique requirements. Sonix' products will allow 3Com to develop these fast growing markets."

"The combination of 3Com's global coverage and Sonix' products and technology promises to be a winner for customers worldwide," said Bob Jones. "The entrepreneurial spirit prevails at Sonix, and teaming with 3Com in this venture to extend the reach of networking to new markets is a great opportunity for both companies."

Founded in 1979, 3Com Corporation (NASDAQ:COMS) pioneered the data networking industry. Today, 3Com offers customers a broad range of ISO 9000-compliant global networking solutions that include routers, hubs, switches and adapters for Ethernet, Token Ring and high-speed networks. Headquartered in Santa Clara, Calif., 3Com is a Fortune 500 company with worldwide research and development, manufacturing, marketing, sales and support capabilities.

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CONTACT: 3Com Public Relations 

Donna Stein, 408/764-5960

3Com Investor Relations 

Kate Patterson, 408/764-6802

Primary Access Corporation

Mark Forster, 619/674-8580

Sonix Communications Limited

Bob Jones or Andrew Hurdle, [phone]