Nortel Networks Acquires Dimension
Enterprises, Inc. to Offer Service Providers Next-Generation Internet
Data Centers and Consulting and Integration Services
February 9, 2000 - WASHINGTON D.C. - Nortel Networks* [NYSE/TSE:
NT] announced the acquisition of Dimension Enterprises, Inc., a
Herndon, Va.-based engineering and business strategy consulting
firm for up to US$64.5 million in cash. Dimension Enterprises, Inc.
(DEI) will help Nortel Networks design and engineer Internet Data
Centers which house the eBusiness content that fuels the Internet
economy and are a key component of the high-performance Internet.
The acquisition strengthens Nortel Networks' Application Service
Provider (ASP) end-to-end offering, called the Managed Applications
Services Initiative, which was announced in December, 1999.
Nortel Networks also plans to leverage DEI's
expertise to build new levels of quality, reliability and profitability
into Internet Data Centers by enabling service providers to quickly
bring to market revenue-generating and high-performance managed
DEI's customers include AT&T, BT, iPass,
and Global One. The company's core competencies include expertise
in business strategy consulting, Internet security, IP networking,
operational support systems, enterprise application integration,
and Internet data center design and implementation.
The acquisition supports Nortel Networks'
business strategy to lead the market in delivering complete solutions
for the emerging ASP market, and to provide the necessary technology
and services to design and construct next-generation Internet Data
Centers. Industry analyst group Dataquest says the emerging ASP
market will grow to US$23 billion by 2003.
The acquisition also solidifies Nortel Networks'
Global Professional Services leadership position as the next-generation
partner for business transformation and implementation services.
"This acquisition represents a key focus
for Nortel Networks' professional services strategy, also announced
today, to acquire knowledge that will help our customers deploy
and leverage high-performance Internet capabilities," said
Kannankote Srikanth (Sri), president, Global Professional Services,
Nortel Networks. "DEI further differentiates our ASP market
offering by providing a critical service component to complement
our end-to-end offer enabling service providers to deliver high
performance and secure application services to their customers.
DEI's focus on addressing customer's business strategy needs up
front is a perfect fit with our Global Professional Services philosophy
and will help us extend value to our customers."
"Nortel Networks is now positioned in
the ASP market to serve as a prime technology and services solutions
integrator, developing and implementing business and service plans,
designing and building Internet Data Centers worldwide," said
Richard Caruso, president, ASP Market Segment, Nortel Networks.
"By selecting and implementing application solutions and providing
systems integration, we'll bring together core networks, management
systems and data centers into a single high-performance solution.
Dimension employees will help us implement our recently announced
EINSTEINet ASP initiative in Germany."
"BT has worked extensively with DEI in
the past to help develop our web hosting offer," said Vernon
Irvin, SVP marketing and Internet, BT Worldwide. "They will
obviously complement Nortel Networks' foray into the IP space and
make a fine addition to their portfolio of services."
"The Internet Data Center is the network's
most critical hub in the delivery of services and applications over
the Internet," said Mike Fitzgerald, DEI's president. "We
have a laser focus on taking applications hosting and delivery centers
to the next level of profitability and capability for all of our
customers. Nortel Networks will now bring us the resources required
to provide strong support to customers which have requirements for
global market presence."
DEI, which engineered and operates one of
the world's largest Internet Data Centers, will strengthen Nortel
Networks' Global Professional Services and serve as a critical resource
for Nortel Networks' ASP initiative. DEI's employees will remain
at its existing facilities.
The acquisition is among the latest made by
Nortel Networks, which recently announced its acquisition of Qtera
Corp., Promatory Communications and other advanced networking companies
with an eye towards building the next-generation Optical Internet.
Nortel Networks' Managed Applications Services
Initiative leverages Nortel Networks' key assets -Preside service-enabling
software, Internet telephony applications, industry-leading Optical
Internet and Wireless Internet technologies, and its acquisitions
of Shasta, XCEL and Periphonics to deliver the enabling infrastructure,
Serviceware and the applications that are designed to accelerate
the ASP market. DEI brings the element of consulting and systems
integration to this broad portfolio.
DEI was founded in 1992, and is headquartered
in Herndon, Va. The company also has facilities in Chicago, Dallas
and Santa Clara, and will soon have a presence in London and Hong
Kong. DEI has grown rapidly from its inception and is one of the
most respected in its field. DEI's professionals include data center
architects, network systems and applications engineers, security
specialists, and strategic consultants.
Nortel Networks is a global leader in telephony,
data, eBusiness and wireless solutions for the Internet. The Company
had 1999 US GAAP revenues of US$21.3 billion and serves carrier,
service provider and enterprise customers globally. Today, Nortel
Networks is creating a high-performance Internet that is more reliable
and faster than ever before. It is redefining the economics and
quality of networking and the Internet through Unified Networks*
that promise a new era of collaboration, communications and commerce.
Visit us at www.nortelnetworks.com.
Certain information included in this press
release is forward-looking and is subject to important risks and
uncertainties. The results or events predicted in these statements
may differ materially from actual results or events. Factors which
could cause results or events to differ from current expectations
include, among other things: the impact of price and product competition;
the dependence on new product development; the impact of rapid technological
and market change; the ability of Nortel Networks to integrate the
operations and technologies of acquired businesses in an effective
manner; general industry and market conditions and growth rates;
international growth and global economic conditions, particularly
in emerging markets and including interest rate and currency exchange
rate fluctuations; unanticipated impact of Year 2000 issues; and
the impact of consolidations in the telecommunications industry.
For additional information with respect to certain of these and
other factors, see the reports filed by Nortel Networks with the
United States Securities and Exchange Commission. Nortel Networks
disclaims any intention or obligation to update or revise any forward
-looking statements, whether as a result of new information, future
events or otherwise.
*Nortel Networks, the Nortel Networks Globemark,
Unified Networks, and How the world shares ideas are trademarks
of Nortel Networks.