NTT Communications Acquires Verio Inc. in $5.5 Billion Deal

Strategic Insights -

NTT Communications of Japan, a subsidiary of Nippon Telegraph and Telephone, will acquire the remaining 90% of Verio Inc. for $5.5 billion in cash, marking a significant move into the U.S. Internet market. The acquisition, which represents a 67% premium over Verio's share price, is part of NTT Communications' aggressive expansion strategy into global markets. With Verio's nearly 400,000 sites across 127 countries, including 14,000 e-business sites, the combined entity will gain a strong presence in the highly competitive U.S. Internet market. Analysts have praised the deal, citing NTT Communications' commitment to becoming a major player in the world telecommunications market.

Key Takeaways:

  • NTT Communications will acquire the remaining 90% of Verio Inc. for $5.5 billion in cash, making it one of the largest cash purchases of an Internet services company.
  • The deal represents a 67% premium over Verio's share price and will give NTT Communications a 100% stake in the company.
  • Verio operates nearly 400,000 sites across 127 countries, including 14,000 e-business sites, providing a strong foundation for NTT Communications' expansion in the U.S. Internet market.
  • Analysts have praised the deal, citing NTT Communications' commitment to becoming a major player in the world telecommunications market.
  • The combined entity will give U.S. dot-com companies a bridge to the Asia-Pacific region and Asia dot-com companies a reliable vertical access to the United States.
  • NTT Communications has invested about $1 billion in the Asia-Pacific region, including stakes in StarHub, Philippines Long Distance Telephone, Davnet Telecommunications, and HK Net.
  • The acquisition is expected to be completed by the third quarter of this year.

Statistics:

  • $5.5 billion: The cash acquisition price of Verio Inc. by NTT Communications.
  • 67%: The premium paid over Verio's share price.
  • $60: The price per share that NTT Communications is paying for Verio.
  • 400,000: The number of sites operated by Verio across 127 countries.
  • 14,000: The number of e-business sites operated by Verio.
  • 2,000: The number of employees at Verio.
  • $1 billion: The amount invested by NTT Communications in the Asia-Pacific region.

Sources:

  • "NTT Communications Said to Agree to Buy Verio for $5.5 Billion, in a Major Expansion Into the U.S. Internet Market." Reuters.
  • "NTT Communications of Japan to Acquire Verio Inc. for $5.5 Billion." Bloomberg.
  • "Verio, Inc. to Be Acquired by NTT Communications for $5.5 Billion." Business Wire.