MegaPath Sells Network Services Business, Eyes Managed Services Market
Data, voice, security and hosted IT services provider MegaPath this week finalized the sale of its network services business to Global Capacity, a Chicago-based connectivity-as-a-service company. Terms of the transaction were not disclosed.
D. Craig Young, MegaPath’s CEO, said his company plans to use the money from the sale of its network services unit to reduce its debt and invest in its cloud and managed services businesses.
“Both MegaPath’s cloud and managed services businesses are growing rapidly and the company is seeing consistent increases in customer demand,” Young told MSPmentor. “Moving forward, MegaPath will be placing even greater emphasis in these areas, with plans to invest in product expansion, marketing, sales and system resources, and possible acquisitions.”
Global Capacity said the acquisition of MegaPath’s network services business expands and enhances its One Marketplace platform, which streamlines and simplifies the process of designing, pricing, procuring and delivering data connectivity solutions.
The addition of MegaPath’s network services business also creates a $300 million company that is “uniquely positioned to change how businesses and service providers buy data network connectivity,” Global Capacity said.
“Global Capacity and MegaPath’s combined network and automation systems form a business that eases the process of extending network connectivity,” Eric Dunne, director of research for data networking services consultant Vertical Systems Group, said in a prepared statement.
MegaPath noted the transaction provides Global Capacity with over 400 new wholesale customers as well.
“Global Capacity is excited to serve this new large customer base,” Global Capacity President Jack Lodge said in a prepared statement. “This agreement provides MegaPath customers with a dedicated vendor solely focused on ensuring they have the best access network performance available and ensures that they are on the cutting edge of network connectivity innovation.”
Pivotal Group, the private equity firm that owns and operates Global Capacity, previously announced plans to buy MegaPath’s wholesale business and national colocation aggregation network and merge these assets with Global Capacity last September.
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