NaviSite Acquires Alabanza and Jupiter Hosting.EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become Accretive Transactions add to NaviSite's Hosting Business ANDOVER, Mass. -- NaviSite, Inc. (www.navisite.com) (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 : NAVI), a leading provider of application management, internet infrastructure and hosting solutions for the mid-market, has acquired two privately-held providers of hosting services - Alabanza and Jupiter Hosting - for total cash consideration of approximately $15.5 million. Baltimore, MD based Alabanza offers a comprehensive suite of dedicated and shared web hosting services A shared web hosting service or virtual hosting service refers to a web hosting service where many websites reside on one web server connected to the Internet. Each site "sits" on its own partition, or section of the server to keep it separate from other sites. , as well as a highly automated proprietary software platform for provisioning and managing high volume hosting solutions. Santa Clara Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , CA based Jupiter Hosting offers dedicated and complex managed hosting and infrastructure services that include high quality and high bandwidth applications such as IPTV (Internet Protocol TV) Also called "TV over IP," IPTV delivers scheduled TV programs and video-on-demand (VOD) via the IP protocol and digital streaming techniques used to watch video on the Internet. , Video on Demand and Progressive Video Delivery; the company also has a data center located in Santa Clara, CA. "Alabanza and Jupiter fit neatly into our managed hosting offerings and were acquired at less than four times expected synergistic EBITDA," said Arthur Becker, Chief Executive Officer of NaviSite. "These transactions add new customers with average revenue per square foot densities of approximately $4,700 per year and create significant opportunities to up-sell and cross-sell our entire suite of managed services An umbrella term for third-party monitoring and maintaining of computers, networks and software. The actual equipment may be inhouse or at the third-party's facilities, but the "managed" implies an ongoing effort; for example, making sure the equipment is running at a certain quality ." The acquisitions were financed predominately through cash on hand. The acquisitions are expected to be accretive to adjusted EBITDA immediately and fully integrated by NaviSite's second quarter. The company plans to update fiscal 2008 guidance for these acquisitions in its next quarterly earnings call tentatively scheduled for the end of September, 2007. About Alabanza Baltimore, MD based Alabanza's automated web hosting Making a Web site available on the Internet. Many ISPs host a few personal Web pages for an individual at no additional cost above the monthly service fee, but the address is subordinate to the ISP; for example, www.friendlyisp.com/pat_smith. solutions, backed by its powerful Domain System Manager (DSM 1. DSM - Data Structure Manager. An object-oriented language by J.E. Rumbaugh and M.E. Loomis of GE, similar to C++. It is used in implementation of CAD/CAE software. DSM is written in DSM and C and produces C as output. [R]) software, are used by web hosting companies, web developers, systems integrators, Internet service providers 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. , and telecommunication carriers. Alabanza's proprietary software platform is a business management tool that guides and automates the core tasks required for running a hosting company, including DNS (Domain Name System) A system for converting host names and domain names into IP addresses on the Internet or on local networks that use the TCP/IP protocol. For example, when a Web site address is given to the DNS either by typing a URL in a browser or behind the registration, web site provisioning and building, store front creation and customer billing. Nearly 165,000 active web sites in more than 25 countries are powered by Alabanza. For more information, please visit www.alabanza.com. About Jupiter Hosting Santa Clara, CA based Jupiter Hosting specializes in managed hosting for companies with high traffic volumes or complex hosting requirements. Working within the OSI (1) (Open System Interconnection) An ISO standard for worldwide communications that defines a framework for implementing protocols in seven layers. Control is passed from one layer to the next, starting at the application layer in one station, proceeding to the seven-layer model, it provides simple dedicated and complex managed web hosting and web infrastructures for over 10,000 Internet properties. Jupiter Hosting has emerged as an industry leader in providing support for high-bandwidth applications such as IPTV, Video-on-Demand, and Progressive Download of Video content over the Internet. Other areas of specialization include IP bandwidth provisioning, server clustering See clustering. , and application or database installation. For more information, please visit www.jupiterhosting.com. About NaviSite NaviSite is a leading provider of applications management and internet infrastructure solutions for the mid-market. More than 1000 customers depend on NaviSite for application development, implementation and management on its web infrastructure platforms in 14 state-of-the art data centers supported by 600 professionals. NaviSite specializes in the mid-market and provides customized and scalable solutions leveraging its broad range of application development capabilities, packaged software See software package. implementation expertise, deep portfolio of best in class technologies and a full suite of web-hosting and internet infrastructure options. For more information, please visit www.navisite.com This release contains forward-looking statements, which address a variety of subjects including the expected future operating and financial results, including profitability, revenue growth and EBITDA, success and performance of NaviSite's product and service offerings, and NaviSite's strategic business plans for growing its customer base and increasing sales. All statements other than statements of historical fact, including without limitation those with respect to NaviSite's goals, plans and strategies set forth herein, are forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: NaviSite's success, including its ability to improve its gross profit, improve its cash flows, expand its operations and revenue, and reach and sustain profitability, depends on its ability to execute on its business strategy and the continued and increased demand for and market acceptance of its products and services; the possibility that financial forecasts of the Company may not be achieved, including those as to expected EBITDA and revenue, or an inability to realize expected synergies or make expected future investments in NaviSite' businesses or NaviSite may be unable to raise the necessary funds to meet its payment obligations to CIBC World Markets CIBC World Markets is the investment banking division of the Canadian Imperial Bank of Commerce. It helps governments, large companies, and other large institutions obtain capital and credit and is a primary dealer in U.S. Treasury securities. Corp. and other creditors; NaviSite's management may face strain on managerial and operational resources as they try to oversee the expanded operations; NaviSite may not be able to expand its operations in accordance with its business strategy; NaviSite may experience difficulties integrating technologies, operations and personnel in accordance with its business strategy; NaviSite's acquisition of companies and businesses may not produce expected cost savings, operational efficiencies or revenue; NaviSite's products, technologies, and resources may not successfully operate with the technology, resources and/or applications of third parties;; and increased competition and technological changes in the markets in which NaviSite's competes. For a detailed discussion of cautionary statements that may affect NaviSite's future results of operations and financial results, please refer to NaviSite's filings with the Securities and Exchange Commission, including NaviSite's most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and its Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. . Forward-looking statements represent management's current expectations and are inherently uncertain. We do not undertake any obligation to update forward-looking statements made by us. All logos, company and product names may be trademarks or registered trademarks of their respective owners. |
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