Tekelec absorbs Santera

* Tekelec buys a controlling share of Santera

Tekelec is buying a controlling share of Santera to form a $40 million, 275-employee subsidiary that will sell a portfolio of softswitches, media gateways and signaling gateways.

The subsidiary will combine each company's respective Linux-based packet telephony gear. Tekelec makes GenuOne, a signaling/call-control platform for TDM, IP and ATM networks. It includes Class 4 trunking capabilities and a media gateway that converts TDM voice to packets, and vice versa.

Santera makes SanteraOne, a switching platform that can function as a Class 4 trunking switch like GenuOne or a Class 5 local switch. SanteraOne also includes a media gateway.

Tekelec will own 52% of Santera with the option to increase that to 62% or eventually to buy it outright. Tekelec is investing $28 million and Santera $12 million to fund the subsidiary.

Spokesmen for the company say this funding will carry Santera through until it is profitable.

David Heard, Santera CEO, will be president of the new subsidiary. It will be based in Plano, Texas, relatively close to a Tekelec facility in Richardson, Texas. Tekelec is based in Calabasas, Calif.

Tekelec President and CEO Fred Lax will be chairman of the subsidiary’s board of directors. Tekelec will hold a majority of seats on the board.

Internationally, the subsidiary, like its founding companies, will compete against Cisco and UTStarcom. Domestically, it will continue to compete against other softswitch vendors, including Sonus and Taqua, and traditional voice switch vendors Nortel and Lucent.

Products from the new subsidiary can be sold as systems that include signaling, switching and gateway hardware, or they can be sold separately and built into multivendor networks.

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