Sonus Aims To Further Enterprise Expansion With NET Buy


SIP infrastructure specialist Sonus Networks plans to acquire Network Equipment Technologies (NET), in a move that will broaden Sonus' enterprise networking portfolio and federal government market footprint.

The deal was revealed Tuesday, and Sonus said it will pay $1.35 per share of NET, valuing the deal at about $42 million and a premium of 14.4 percent on NET's closing price on June 18. Sonus, Westford, Mass., said it expects the deal to close in the third quarter of 2012 and bring incremental revenue of $15 million to $20 million to Sonus in the second half of the fiscal year.

According to Sonus, NET's Unified Exchange (UX) and other products complement Sonus' session border controllers (SBCs) and bring it an installed base of customers, distributors and VARs, particularly in the federal space. SBCs, a Sonus specialty, are a hot market right now thanks to stepped-up customer interest in SIP-based communications. The SBC market is expected to grow 26 percent year-over-year through 2016, according to Infonetics Resaearch.

[Related: Sonus Channel Program Targets SIP-Savvy Partners]

Fremont, Calif.-based NET's purview is products that simplify networks by converging PBX voice traffic with data networks and act as survivable branch appliances. NET's own SBC integrates SIP and H.323 call control, as well as SS7/C7 signaling, secure voice and a number of other features. One of its UX devices, the UX2000, is a modular 1U system purpose-built for Microsoft Lync deployments.

Raymond Dolan, president and CEO of Sonus, said the acquisition of NET will accelerate Sonus' expansion into the enterprise.

"Businesses have struggled to unify communications via their legacy PBX platforms. Together, Sonus and NET could offer a portfolio that would enable enterprises to seamlessly and cost-effectively deliver unified communications from their headquarters locations out to branch offices," Dolan said in a statement.

Sonus, which has hired a number of well-known UC and software channel executives in the past two years, recently added new SBCs focused on enterprise customers and launched Sonus Partner Assure, its inaugural enterprise-focused partner program.

Sonus plans to sell 100 percent through the channel to enterprise customers, as well as bring on select partners to sell to its roughly 120 telecom customer accounts. Joe McLaughlin, vice president of channels, recently told CRN that Sonus' goal is to add 20 to 25 new reseller partners by the end of the year.