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PSINet Acquires Metamor Worldwide to Create e-Business-Focused Enterprise

Strategic Insights

— 1 min read

The acquisition, announced today by PSINet Inc., aims to create a robust e-business-focused enterprise equipped to provide turn-key out-sourced systems, ranging from Web design to managed hosting. The entity will be formed through the acquisition of Metamor Worldwide, Inc., a major supplier of information technology (IT) systems. Metamor, with 1999 revenues of $577 million and 70 offices employing over 4,500, has a strong presence in the IT industry. The acquisition also gives PSINet a controlling interest in Metamor's publicly traded e-business subsidiary, Xpedior Inc., which provides e-commerce systems to global companies, governments, and emerging digital businesses.

Key Takeaways:

  • PSINet acquires Metamor Worldwide, a major supplier of IT systems, to create an e-business-focused enterprise.
  • The acquisition includes the purchase of Metamor's publicly traded e-business subsidiary, Xpedior Inc., which provides e-commerce systems to global companies.
  • Metamor has 1999 revenues of $577 million and operates 70 offices, employing over 4,500 people.
  • The transaction is structured as a tax-free reorganization with a $1.9 billion purchase price consisting of approximately 39.9 million shares of PSINet common stock.
  • Each share of Metamor will be exchanged for 0.9 shares of PSINet common stock.
  • The acquisition is expected to be completed by mid-2000, subject to shareholder and regulatory approvals.
  • PSINet will gain control of Xpedior's e-business capabilities, which include developing new e-business systems and delivering end-to-end solutions to clients.
  • Metamor's IT services include e-business programs, package software implementation, and custom application development.
  • The acquisition expands PSINet's IT services and positions the company to offer a broader range of e-business capabilities.

Statistics:

  • $577 million: 1999 revenues of Metamor Worldwide.
  • 70: Number of offices operated by Metamor Worldwide.
  • 4,500+: Number of employees employed by Metamor Worldwide.
  • $1.9 billion: Purchase price of the acquisition.
  • 39.9 million: Number of shares of PSINet common stock involved in the purchase price.
  • 0.9: Exchange ratio for each share of Metamor.
  • 27: Number of countries where PSINet operates its services.
  • 800: Number of metropolitan areas where PSINet has direct access.
  • 2000: Expected year of completion for the acquisition.

Sources:

  • PSINet Inc.
  • Metamor Worldwide, Inc.
  • Xpedior Inc.
  • Newsbytes.com (http://www.newsbytes.com)
  • Reported by Newsbytes.com (20000322/Media Contact: Reid Walker, 703-375-1103, e-mail: rwalker@psi.com/WIRES ONLINE, BUSINESS, PC/PSINET/PHOTO)

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