Acme Packet buys Covergence

* Acme Packet buys Covergence to significantly expand its enterprise product strategy

Acme Packet last week announced it has acquired Covergence in exchange for about $22.2 million in stock and $600,000 in cash. Covergence provides software-based session border controllers (SBC) for unified communications, and is focused on the enterprise market while Acme Packet's portfolio is more typically found in service provider networks. Acme Packet's move follows the company's April 2009 release of the Net-Net 3800, a hardware-based SBC also designed for small enterprise sites, contact centers and service providers.

In a prepared statement, Andy Ory, CEO and co-founder of Acme Packet said “SIP trunking – with its compelling return-on-investment and increasing worldwide availability – will drive many enterprises to deploy it to even the smallest of locations. With the acquisition of Covergence, Acme Packet accelerates its ability to now satisfy the SIP trunking SBC requirements of enterprise small offices and remote sites.”

The Covergence SBCs are available as Unix-based software for Intel x86-class servers or as a virtual machine package and are designed to offer “operating expense friendly price points for smaller sites,” according to the company. The Covergence CTO, VP for Enterprise Product Management, and VP for Business Development will all retain their roles as part of the acquisition. Covergence also brings four of the Fortune 25 companies to Acme Packet’s enterprise customer base.

Jeff Ogle, Senior Analyst, IP Services Infrastructure at Current Analysis commenting on Acme Packet’s move said, “Acme Packet is buying a competitor and significantly expanding its enterprise product strategy. The Covergence acquisition is designed to supply Acme Packet with a complete product family for the enterprise market in a fashion similar to the way it addresses the service provider market. While combining the two companies’ products and revenue will have no immediate effect on this market segment, in the longer term this transaction could prove to be a wise strategic move for Acme Packet.”

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