Excel Switching Corporation Expands Addressable Market Through the Acquisition of RAScom.HYANNIS, Mass.--(BUSINESS WIRE)--April 15, 1999-- Excel's EXS EXS Expandable Switching System (Lucent) EXS Executed Schedule Carrier Solutions Enhanced by Acquired Data Expertise Excel Switching Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :XLSW XLSW Excel Switching (former stock symbol; now delisted) ), a leading provider of open telecommunications platforms for networks worldwide, today announced that it has signed a definitive agreement to acquire RAScom, a leading provider of open remote access server (RAS (1) See network access server. (2) (Remote Access Service) A Windows NT/2000 Server feature that allows remote users access to the network from their Windows laptops or desktops via modem. See RRAS and network access server. ) technology. The acquisition of RAScom will expand Excel's addressable market by adding data capabilities to the Expandable Switching System (EXS) product line for the Internet Service Provider Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. (ISP (1) See in-system programmable. (2) (Internet Service Provider) An organization that provides access to the Internet. Connection to the user is provided via dial-up, ISDN, cable, DSL and T1/T3 lines. ) and Competitive Local Exchange Carrier (CLEC (Competitive Local Exchange Carrier) An organization offering local telephone service that is not one of the traditional telephone companies. The Telecommunications Act of 1996 allowed competition to the incumbent telcos (ILECs), enabling new companies (CLECs) ) markets. Infonetics Research believes that the market for Internet access equipment and related services will reach $12B in year 2000. The introduction of a highly integrated solution will make it possible for ISPs and CLECs to deploy an economical solution that meets their voice, signaling and data requirements. The integrated product will give access providers the ability to offer reliable packet-oriented data services with circuit-based telecom services eliminating the need for separate switching, SS7 gateways, packet routing and remote access systems, collapsing them all into a single, cost-effective NEBS compliant platform. In addition, as part of Excel's ONE Architecture, Excel Partners will now be able to offer data services along with other enhanced services. The addition of the RAScom team will bring technical expertise to Excel in the areas of access, LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. routing, VPN (Virtual Private Network) A private network that is configured within a public network (a carrier's network or the Internet) in order to take advantage of the economies of scale and management facilities of large networks. and other emerging data technologies. "The strategic acquisition of RAScom will add significant access and data capabilities to Excel's EXS platform," said Robert Madonna, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Excel. "The addition of RAScom technology will enable Excel to offer a uniquely integrated, highly scaleable, telco reliable and open programmable voice and data platform to the ISP and CLEC markets. RAScom's technology also complements Excel's recently announced EXS Media Gateway and the integration of VoIP technology into the EXS product family." "RAScom has been working with the sales, marketing and engineering teams at Excel since early last summer on the definition and integration of a combined product," said Mark Galvin, President and CEO of RAScom. "We have found that the companies' cultures and development philosophies are very similar, and that the teams have worked together effectively." The newly integrated voice and data solution will provide emerging and established carriers and access providers MultiService Access Switching at a compelling price. With Excel's high-density integrated switching, VoIP gateway and RAS platform, carriers can drastically decrease co-location expenses by reducing rented Central Office real estate while providing a homogeneous management and service provisioning environment. Transaction Terms Under the terms of the agreement with RAScom, Excel will acquire all outstanding shares and options of RAScom in exchange for approximately 1.1 million shares of Excel common stock. The transaction is intended to be accounted for as pooling of interests Pooling of Interests An accounting method, used in mergers and acquisitions, where the balance sheet items of the two companies are simply added together. Notes: The opposite of pooling of interests is the purchase acquisition method. transaction and to qualify as a tax-free reorganization. Based on the closing price of Excel common stock on Wednesday, April 14, 1999, the transaction is valued at approximately $24.5 million. The transaction is anticipated to close in approximately two weeks. Excel expects the transaction will first become accretive during the Company's fiscal year 2000, assuming expected revenue and cost synergies. About RAScom RAScom designs and manufactures a complete remote access solution based on open platforms for enterprise networks, carriers and Internet Service Providers. RAScom's primary product line, the RAServer series of remote access servers, concurrently supports access over both the Public Switched Telephony Network and the Internet. The RAServer family runs on a Windows NT Server platform, making it an open systems platform for integrating any combination of enhanced services. Visit RAScom's website at http://www.rascom.com. About Excel Excel Switching Corporation is a leading provider of open switching platforms for telecommunications networks worldwide. Excel develops, manufactures, markets and supports a family of open, programmable, carrier-class voice and data gateways that address the complex needs of network providers. Excel's products are currently deployed in telecommunications networks worldwide. Visit Excel's website at http://www.xl.com. This release contains forward-looking statements that are made pursuant to the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The forward-looking statements contained in this release are subject to a number of risks and uncertainties that could cause actual results to differ materially from the company's expectations. If the acquisition is completed, there can be no assurance that the combined companies can successfully integrate the acquired businesses, products or technologies. The integration of the acquired business may cause a diversion of management time and reallocation of resources The provision of logistic resources by the military forces of one nation from those deemed "made available" under the terms incorporated in appropriate NATO documents, to the military forces of another nation or nations as directed by the appropriate military authority. . There can be no assurance that the RAScom open remote access server technology can be successfully integrated with Excel's product line and manufacturing and distribution infrastructure, or that further product development will be required to integrate RAScom's products with those of Excel. There can be no assurances that revenues will exceed operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , or that the present level of sales of the RAScom product will continue, that the company can be successful in reducing expenses to achieve profitability, or that customers will continue to support the company's product initiatives following the reorganization. Investors are cautioned that all forward-looking statements involve risks related to the market acceptance of and demand for the combined company's products, new product development, impact of competitors, and dependence on third-party distribution channels. |
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